to not trust the unions or the government re public sector pensions

[bonded]

With even more fire person and NHS strikes that affects us all I want to be informed on the subject. But I don't trust either of them.

Is there anywhere with a balanced view?

I don't want fire people working till they are 68 but at the same time an average earning fire person having a 400k pension pot doesn't sound affordable.

Nomama, I'm not disagreeing with you. I think that this has issue has been misrepresented and oversimplified by all sides, each pursuing their own agenda. However, I'd disagree your point that everyone knows what already exists remains the same; in this thread, and in virtually ever other one on this subject, there are posters saying that they signed up to this however many years ago, and things shouldn't be changed.

The necessity (and desirability) of the changes themselves should be up for debate; I personally think that the previous arrangements were unsustainable, largely because of the increase in longevity, but it's clear that a lot of people either genuinely believe that the pension they've already earned has been taken away, or that there was some cast-iron unbreakable guarantee that nothing would ever change. That may well be the fault of the media (who I agree are shite at reporting this, but they're for the most part relying on soundbites and press releases prepared by others who are pushing an agenda), and I share your frustration that this is being misreported.

I wouldn't for a moment suggest that any worker, public or private sector, who objects to having their terms and conditions worsened (which is what's happening here, let's be clear about that, even if what's being proposed is still a pretty good deal) should have the right to strike - my family background is coalminers and dock workers, so I have a history of militancy. I do think, though, that if the union is asking members to strike, they have the duty to put the facts and the arguments clearly, and I'm slightly disappointed that in this case, many of the unions have been concentrating so hard on winning the media war that they've neglected to give members the full picture. I fully understand why they have to do it, but I'd just be happier if they could take the moral high ground a bit, and not sink to the level of the media, if you see what I mean.

FWIW, I don't think anyone here is being greedy and unreasonable. I'm a public sector worker as well. It just boils my piss a bit that people are being misinformed, and underinformed, about a subject that is going to have such a massive effect on their futures. We will already be paying more than we thought for those pensioners, public and private sector, who have already retired on the basis of promises made decades ago, and the costs of which have been miscalculated. We need to have a serious debate about whether our children will be able to afford our pensions, and that debate isn't assisted by either side just pushing their own agenda.

Ah! Thanks.

I know I said that what had been contracted for should be met. I was only referring to past contributions, ones already 'in the bank'.

Changes have to be made, but legally and without all that piss and vinegar spleen venting.

Maybe we should keep on 'disagreeing' like this. Shine light on the realities and prevent the divide and conquer thing

Sorry Boney, I'm probably missing something as I'm not familiar with the details of the TPS so I'm relying on Google which never ends well This link says the pension design switches from final salary to career average from April 2015.

www.teacherspensions.co.uk/reform/members/at-a-glance.aspx

Have further changes been proposed?

Nomama

Apologies if it seems contradictory.
When the TPS started, teachers were paying in with none retired, so more money was paid in than out. Over time, people have retired and been paid, so currently more cash is paid out than in. Over the history of the scheme, £45 bn (per the NUT) more has been paid in than out.
However, the scheme owes pensions to over 1 million retired and non-retired members.
If the scheme stopped now, according to the accounts (linked earlier), they currently calculate that the scheme would have to pay out £60 bn (ie the £45bn paid in plus an additional £15bn deficit). This deficit would have to come from tax payers.
This deficit is calculated based on the changes made, the position would be worse if no changes had been made.
My point is that the teachers pension scheme, along with all public sector schemes, is supported by the taxpayer, and not fully funded by staff and employers.
Additionally, when comparing pay between private and public sector, employer pension payments are rarely included and are normally much more generous for public sector employees.

Oh! The pay forward aspect.

So technically it is currently self funding but, if it suddenly closed, ie teaching suddenly stopped, then, also technically, maybe hypothetically, the taxpayer would have to pick up the tab for the shortfall.

And yes, employer pensions are usually more generous, as has been said quite a few times, it is the swing that balances the roundabout that is our salary. But as that is another contentious issue that causes an equal amount of argument.

I think this is the point where I say fuck it. If anyone thinks I am overpaid, over holidayed or over pensioned, come do my job! Get the qualifications and become a teacher.

If you don't want to then simply thank us for doing a job you won't or can't!

Cornish

The transition date table link from your link is helpful.

The problem is that from the independent adviser that my school gets in, we are still waiting for the information about further changes to filter down.

But any information from the government flips and flops so badly that even those in the pensions business don't know what is going on.

But to answer your question from the paperwork that I have in front of me I am on a average salary scheme.

Looks Like I will have to chase up the TPS.

Boney Pensions communication is frequently woeful in my experience, sadly. It tends to either be full of jargon or so lacking in detail and patronising that it's pretty pointless and off-putting.

I'm almost certain to fall into one of those traps now but just in case it's helpful in any way here goes...

Some degree of averaging is common in final salary schemes eg the average of the last 3 years' salary is often used to calculate the pension. Career average schemes tend to be described something like: in year 1 you build up 1/57 of your earnings that year, then that block of pension is increased in line with some sort of inflation measure to retirement. In year 2 you build up another block of pension that is indexed up and so on.

Nomama

No the tax payer will have to pick up the bill for the shortfall even if teaching continues - it is currently paying out more than it receives and will continue to do so for a long time, and will net payout more than has been paid in.

I have never said you are overpaid or any of the other rubbish, but if teachers and unions continue to mis-represent earnings and benefits and imply you are hard done by, people will challenge this. If everyone was honest, there may be less argument.

That doesn't necessarily follow, carol. Teaching is being slimmed down, cheapened, pensions being reduced. The balance may well swing back the other way again, we don't know.

And I didn't say you thought or had said any of those things. I just reached the end of my ability to argue the same old same old again. I am being honest, I am not misrepresenting anything, nor am I implying I am hard done by. I am just sick to death of having to justify my right to do my job and be paid for it according to my contract.

All the rest is politicking. And I am as lied to as anyone else. The cock ups and financial fuck ups are not of my doing, nor of any other teacher. However we are easy targets, especially with the meeja misrepresentations, and I am sick of being a scapegoat.

Indeed Nomama and public servants - except a few in the Government Actuary's office - are not actuaries and none of us can see the future. If you bought an index-linked annuity from a life-insurance company when you were sixty and you are now ninety-odd and hale and hearty the shareholders or members as the case may be have to shoulder the cost and nobody suggests that it is unreasonable and you should accept less than your rights - and that on a large scale is what the increase in longevity amounts to.

But no-one is changing historic rights. Companies and employers change terms on a regular basis, including pay rises. Some are more major than others.
If you don't like the new contract you are free to leave and work elsewhere, as is anyone in any job.
The difference for public sector workers (and I accept this is unfair) is that taxpayers fund the salary.
If I disagree with a private company's pay (or other) policy, I can stop using them (or start if I approve), but I cannot stop paying taxes, so do care whether I think people are getting a fair deal.

Teaching not a physical job[ shock]

I bloody wish. When pedometers were the thing, I measured how far I walked on an average teaching day. It was about 6 miles......

The contract was for the long term; contributions until retirement, final salary pension after retirement. It is wrong, wrong, wrong to change the rules half-way through.

A life-insurance company would not be allowed to do it - why should the Exchequer?

andrew the contract will be honoured to the date of change - years earned prior to the change will get the same benefits as were promised, it is only new years that will get a different rate.
Would you say a worker should never get a payrise as the terms were agreed at the start and should never change?

No contract of employment excludes pay rises! What is being done is a fundamental change in the structure of the system.

If inflation (in CPI terms) goes sky-high as it did in the Seventies what confidence can pensioners have that the Chancellor will not say that the burden cannot fall entirely on the hard-working taxpayer, we're all in this together, etc, etc, while the DM bays in support and the unions look the other way, and refuses to honour the obligation to increase their pensions in line?

Andrew, I'm sorry but that comment is a prime example of the things I've been talking about. Any pensioner (ie, actually receiving a pension) won't be affected by the changes - the pension they've earned won't be changed and will continue to be subject to the rules under which it was earned. And although employment contracts don't exclude pay increases, they do specify a rate of pay, so any change in the rate is a renegotiation of the contract. It happens (or it does for those still receiving pay increases) every year.

The earlier comment you made about comparing this to an annuity was also only correct if you are referring to a current pensioner - if you're talking about people who are still in employment, then the correct comparison would be that the pension they've earned under the old rules is one annuity, and the pension they earn in the future will be on different terms - so, if we were to compare it with an annuity, your comparison would be suggesting that someone who bought an annuity decades ago should automatically have the right to buy another one, on exactly the same terms, no matter what the present terms are. The nearest comparator to that argument is Equitable Life, with their guaranteed annuity contracts. No insurance company would offer that today.

andrew To achieve the scenario you describe above (refusing to honour agreed increases to pensions in payment), a change in legislation would be required as past service benefits are protected by law.

Not sure how much confidence this gives when the employer here is effectively the government who do have the power to change laws. (At least the private sector employees who've already seen major changes to their pension schemes have the comfort that their employer is bound by the law...) But at the very least, it would be a major undertaking for the government to erode pensions that have already been earned.

And just to add to CornishYarg's comment - changing the law to deprive someone of property isn't that easy. Europe and all that. It could (conceivably) be possible to change the law to say that increases to pension already earned would be by reference to a difference price index, but it would still need to be an index which actually reflects inflation (so RPI to CPI is OK, RPI to (say) some index reflecting increases in just house or fuel prices wouldn't be).

Nice to be on a thread about this subject that hasn't degenerated into name calling and whinging about teachers' holidays though. And on AIBU too. Must be the presence of all the mild-mannered pension geeks.

Tartina That might be the first time "mild-mannered pension geeks" has been used as a compliment!

TartinaTiara For practical purposes the State did offer the right to go on buying the annuity on the same terms and should have stood by the offer.

They may also have tried to make changes under the table - which is what started the mistrust and misunderstandings.

As I have said a few times, I, and many others, are fully aware of the details of the changes, the bits that stay the same etc etc. Those details, for me, are not at issue, nor are the changes - always supposing TPS has a change of personality and gets its facts and figures right. They have now been published clearly and accurately.

It would be nice if the public perception of teachers could be left to find its own level now, without the meeja portraying us, and other public sector workers, as the very devil.

No, Andrew, I appreciate that's what you believe, but that's only true for those who are already retired. It's absolutely not true for anyone currently employed. The employment contract can be renegotiated, and is, on a regular basis.

We can argue the rights and wrongs about changing pension rights from a moral perspective until the cows come home, but legally, it's perfectly OK. And it's equally perfectly OK, in legal terms, to object and to take industrial action to voice that objection. My point is that when people are making these decisions, they need to have complete and accurate information. It helps no-one to just say "but it isn't fair".

Nomama, they can't make changes "under the table", or at least not to the regulations governing the schemes - by law, they have to be consulted upon, and in practical terms, they should be fully negotiated and (ideally, but I tend towards the idealist) agreed.

I appreciate that, in practice, employers are now using the discretion (always there) to refuse early retirement, and that competency procedures are now increasingly used instead of early retirement. That's an argument that needs to be aired, but it's a different argument to the pension changes. And I absolutely agree that teachers (and other public servants) aren't lazy/incompetent/overpaid or whatever the latest media cliche is. When I become Queen of All the Fucking World (it will happen, I have a cunning plan ), it's going to be a hanging offence for journalists to write lazy shite about things of which they know nowt.

Tartina... I said they may have tried which was the starting point for all the mistrust and misunderstanding. There was talk of changes with few details and sweeping statements - until the unions stepped in. That led to the last set of changes.

Sorry, that came out grumpy... send me a ballot paper for your election, I may vote for you

Another pensions professional here, it's nice to read an intelligent discussion on issues, usually I give up after page 1...

Defined benefit pensions, whether final salary or career average revalued earnings, are just not a viable model any more. Or at least, not in the private sector where I work, so I don't see why that shouldn't be the same in the public sector.

It's a shame, as it's wonderful to give people the comfort of a guaranteed level of income in retirement. And because as DB schemes fall away I become less and less employable!

My husband and I earn similar amounts, have similar qualifications etc. By retirement I can expect to earn more. His protected defined benefit pension is ten times more than my projected defined contribution pension! Now of course we don't actually know what mine is going to do, so who knows. And it's a slightly simplified view as his scheme will change etc. But that is the level of difference we're talking about.

Pensions tend to be underappreciated in my experience. I'm not sure I've ever spoken someone with a defined benefit pension who appreciated just what a valuable benefit it is. So I can see why employers may wish to spend less on something that may be more appreciated, eg pay rises. Again, this argument may not transfer to the public sector, I don't know.

A few years ago I was at a talk given by one of the founders of one of the big pensions consultancies. He suggested a career average scheme with a 1/100th accrual rate, no increases in deferment. I think he also suggested no spouses benefits or increases in payment. It seemed like quite a sensible arrangement, with members having predictable income and employers having manageable costs and risks.