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FRS17 and ACT most definitely had a HUGE impact on all of the funded public sector schemes - like the LGPS
and it was the fact that they started to get their house in order that forced the unfunded schemes to start looking at their viability.

The basic point is that to fund a final salary pension at current life expectancy involves putting aside over 25% of the persons salary per year.
NO scheme is doing that.

The unfunded schemes (teachers, NHS, MOD, Civil Servants etc) are putting aside around 15% leaving the other 10% to be found out of future taxation on the children of the beneficiaries (as they will have retired by then).

And yes, the MP's pension scheme is pretty offensive
but then so are things like a half million pound payoff to a Union boss who resigned (was not even sacked)
and the fact that Union bosses on around £85,000 a year will keep their final salary schemes even while their members lose theirs.
"We're all in it together"
Yeah right.

I support it...how else will the govt hear the cries of the people?!

Which is of course disgraceful that they are not protected, isn't it?

winkywinkola - a bit irrelevant - maybe a few hundred people a year at most in that category. the vast majority of private sector workers are not protected.

the gist of what talkinpeace says is correct though. it's an unsustainable situation that is political dynamite but must be addressed a lot more thoroughly than the concessions being granted by the government now

"The private sector - who get sacked if they cock up " Not if they're top management or bankers, they don't or if they are asked to leave, they get a thumping great golden goodbye.

TalkinPeace2 Sorry, but your post is riddled with factual inaccuracies.

Contribution holidays were possible because of the stock market boom. Inflation would be a dampener to over-valuation since this would be reflected in scheme liabilities. FRS17 was not 'allowed' by Gordon Brown. He had nothing to do with it. Do you actually know what it is, even? I'm thinking not. Neither FRS17 nor the ACT raid nor PA 96 affected most public sector schemes.

No FB here, either.

I support the principle of the strike, but I'm that it will achieve anything positive. This bloody government's more likely to tut that the peasants are revolting and do their best to restrict union powers even more as a punishment for trying to make them out to be the evil ones.

Pensions in their current form were invented in around 1910 - when life expectancy equalled the retirement age of 65

as employment rights and union backed pension legislation strengthened through the 1960's and 1970's pensions turned into more and more of a Ponzi scheme

during the 1980's inflation was so high that most schemes took Employer Contribution holidays (their surpluses were so big)
but then in the 1990's Chancellor Broon abolished ACT credit and then allowed FRS17 to take effect

so the schemes had to finally work out how much they had to take IN to pay OUT what the pensioners were entitled to

and the size of the abyss became clear.

The private sector - who get sacked if they cock up - moved rapidly to make their schemes affordable (to the employer at least)

Broon and Dahling encouraged the public sector to keep its head in the sand even through 2009
but the excrement has interacted with the ventilation device

those ex public sector workers on their 40% tax pensions are an anomaly that we will all pay for but never replicate.
Sorry folks.

Rocks - I agree that the strike isn't really about pensions, as most people don't really understand how they are made up and just feel they are having something taken away from them. I do think the government has a duty to explain to people what is actually going to happen to them in old age and to show the various options. I have three degrees (one in public sector management in fact) and have no idea on the Best Plan for retirement other than, as was said lower down, trying to pay off mortgage and save money, but even that doesn't feel very secure, and becomes harder to do each month.

I know I annoyed you by saying I was making my DCs do school work today, but I am (obviously) not saying that that is as good as being in school.

Clearly I would much rather them be in the school, but I am trying to give them the next best thing, which is a chance to practice their books etc at home, as they are meant to anyway. I am slightly bitten by school strikes, I think, as I grew up in a pretty militant area and spent large parts of my primary years out of school on strike days. My Mum was always very clear that they were still school days, not holidays, as there were so many that it had a real impact on the available teaching time and the general mood within the school. I now this is only one day, but if the threat of rolling strikes becomes real I just want to do the best I can to minimise the impact on their learning. I actually swapped my work days around to be able to spend the day with them today so am happy to admit that I may be a bit odd about this, but I just didn't know what else to do. I do feel a bit that we (and the kids especially) are being held to ransom on this.

sorry, not making any sense in my first paragraph. I meant that if you moan but don't do anything about it, you have no right to complain. Duh.

I can fully see why people in the private sector resent the pension schemes of those in the public sector, even though as a teacher I benefit from it myself. To me personally, the strike is about more than the pension. I feel it's like complaning about the government but not bothering to vote in the election.

There are many ways in which I feel the current government are not behaving morally - vilifying people who work to heal sick people and educate children as scroungers and a scourge on society is just one thing. I resent the fact that £600 million was awarded yesterday to Gove's free school project when I'm teaching my pupils from out of date textbooks that are falling apart, for example. But I feel strongly that unless I do something about it, in my own limited way, then I'm giving them carte blanche to do whatever they like.

If you use the moneyadvicecentre that the Govt set up there is a pension calculator. Google 'moneymadeclear'. Sorry can't do link at the moment. Remember the basic state pension is about £102 per week (can't remember the exact figure) but £5300 per annum each for you and DH plus your public sector pension to date. How much you need will depend on your living expenses but the calculator will help you have a look at how much you would need to invest to be able to top this up.

Thanks for your opinions on the future btw Theta and Losingtrust.

What would be a good amount to contribute to more liquid savings towards the future in your 30's/40's, do you think? Supposing that mortgage can be paid off etc?

Rocks and that is a real time bomb for society. :(

Niceguy, I'm not saying it is, nor have I ever said it is. I just think there needs to be some real discussion about this instead of lies, lies and damned statistics on both sides.

Theta, I don't think I will have that option re: public sector really. There is no way my service and specialism will survive the next five years in this climate (very few in mental health/learning disabilities will, always soft targets).

thetasigmamum I agree, absolutely not. Georgie boy is out of his depth and out to land the poor in it wherever he can.

The Govt is bringing in auto-enrolment for the private sector starting from next year but will not have a real impact until 2016 but the contributions scales that will be compulsory are very low and will be nowhere enough to live on alone. We heard yesterday that the State Pension for most of us will not be paid until 67 and I have revised my own retirement age up to 67. I think we do have to face that we all have to work longer. The self-employed are the most hard hit as they have to pay everything themselves and I would always recommend a balance of savings, pensions for basic and more liquid savings. If higher rate tax relief goes and salary sacrifice the arguments for pensions for the self-employed will go and other forms of saving would be better. I would always join a company scheme because many have life cover, income protection attached and being in your 30s/40s is not too late. I would always try and clear any mortgage by retirement age as a priority as this will cut down on spending in retirement and reduce the need to continue to earn.

I saw a very interesting postcard on the Art of Pensions website with a victorian father sitting with his three children and one child said 'Dad what was a pension?' I am afraid the future looks bleak due to people living so long and therefore get as much as you can from your employers.

Incidentally in countries where it is the norm to retire at an older age general employment for young people is higher so evidence seems to show that it is better to have a late retirement age for employment in a country as this creates more wealth.

Sorry no one answer except save, pay off any mortgages if you are lucky enough to be able to get one and accept that we will all have to work to an older age. My first pension was set up to age 50, how optimistic and wrong was I?

I really do worry what the future holds,

So do I rocks, so do I. But what i do know is that paying a certain section of our society pensions we cannot afford is not a good idea.

Rocks Do whatever you can to stay in the public sector, basically.

Essentially, we all appear to be doooooomed. The only real answer is to rip it all up and start again. But people wouldn't agree with that.

I don't agree with losingtrust that the government would have been best advised to offer to transfer all younger scheme members to effectively a GPPP - having had that done to me back in the late 90s, when I had only been in the proper pension scheme for a year, wasn't a good experience. That would make people far more pissed off and I don't think it would be necessary if people would accept some of the changes proposed and if the government would get real about taxing the high earners (like everyone else I define 'high earners' as those earning just a bit more than me ;) ) and in particular targeting excessive pension pots (FSV excessive - look at university VCs for an example of what I consider to be excessive. Or maybe that Brodie Clark - it's ridiculous that the public sector should be offering pensions that huge. Not just ridiculous - disgusting).

Losingtrust, what do you think the solution is with reference to private sector pensions? As I mentioned upthread, I don't expect I will be in the public sector very much longer (job expected to go next year, and my area is too niche to expect that similar jobs will survive or be created elsewhere in the public sector) and dh is in the private sector. I will most probably end up self-employed on a free-lance basis and dh's current pension is, well, worth sod all after some of his portfolio crashed and burned.

I really do worry what the future holds, because I've been to too many conferences that detail what life will be like in terms of elderly care needs in the future. Elderly care is already expensive and substandard. I don't want to spend my latter years having my tea at 4.30 and sitting around in my pyjamas from 5pm because they won't pay overtime to send someone round later in the evening.What is the best option for people in their 30's and 40's to prevent an old age of poverty (regardless of whether they are public or private sector now)?

It's not Ed Balls who is losing credibility.

Good post Rocks. I am a pensions manager and therefore know quite a lot about pensions. I have worked predominantly in the private sector with many different schemes and have been involved in closing final salary schemes and can really recommend that public sector workers to find out for themselves as I have found the union information very misleading and encouraging people to strike with scare facts. The Unison myths were very misleading. The government has not helped either. I would be paid more in the public sector but enjoy working in a company that actually trades and makes things (no attempt to be a martyr) I just enjoy it more. Believe me even with the cuts suggested you would not be able to achieve the same type of pension in most private sector companies and would be nowhere near if you opted out and joined a personal pension pension plan. The government should have provided two options - a dc scheme with the same employer and employee contributions, although in TPS this would need to be notional and a second which would be a career average to age 65 with a higher level of employee contributions. This would have provided more options for people and the BBC ended up doing this in the end. However, I support the strike in raising the issues but do think both sides have handled the situation very badly and do not believe they will make any difference and only the poorer paid have lost out on a day lost for either striking or taking time off to care for children. Both sides are spoiling for a fight.

Yes Rocks I agree with the language used in these debates.

This is why I think it's time for the smirking Ed Balls to be honest. Does he want the country to self combust under the confusion of the situation being created by pretending he has a wonderful alternative. Be Honest Ed. Get behind the country and forget the point scoring for once. Remember you were very much in the last government decision making centre and know the full story.

I think if Ed Balls wants (forget the leader puppet they currently have who is not even worth bringing into the equation) a future in politics he needs to be honest now. He is losing credibility like no-one's business.

Babybarrister, you are probably right that most people can't get a grip on the numbers.. though in some ways if they did wouldn't they be even more inclined to strike? I suspect that there are a great many people in the public sector who are in this sector because they are quite risk averse and having a secure pension has been a big incentive for them in choosing their careers. It is difficult for people who must suddenly face an uncertain future, even if there are good economic reasons why this must be so.

My talents are not in numbers and percentages (putting it, ahem, mildly) and it strikes me more and more from the general discussion that the figures are very difficult for people without an aptitude in that area to really grasp, which doesn't help. I am an intelligent, educated person with two first class honours degrees and a distinction in a Masters, but all are in the medical field and perhaps I am ill-equipped to understand this matter. I certainly can't fully understand some of what I am reading, and I will admit that.

However, it does make me think that my contention that most people striking really aren't striking about the pensions is likely to be accurate. Bear in mind the extremely low turn out on this vote. People found it hard to understand, across all unions. However, more people are striking.. and the reasons for that are complex. Not wanting to cross a picket line, not wanting to go against their union, feeling it is wrong to let others strike on their behalf.. these are all reasons I have heard people use to almost apologise for their part in this action (particularly in the NHS).

I feel there has possibly been a lot of information from all sides which has been quite technical which makes it harder for non-specialists to follow. As I said before, I think the governmental policy with relation to these cuts in general is to blind people, as all governments do, with spin and gobbledigook. The Unions, inevitably, are no different. No one says baldly: "the money is gone". They say "this way is fairer" or "this is unfair" rather than "this way is the only way we can survive".