To think public sector DB pensions should be illegal

[OneAmberFinch]

Everyone seems to accept that it's obvious that the private sector, speaking very generally, pays better salaries in-year but the public sector makes up for it in excellent defined benefit (DB) pensions.

As in, you get a certain amount paid to you indefinitely, based on how many years of service, your level reached, average or final salary, etc.

Everyone acts like this is normal but it is actually insane!

Growing up in school I was always taught that it was a fundamental principle of a parliamentary democracy that one parliament cannot bind another. Parliament should be able to override anything a previous parliament did, so that voters always have the ability to change course democratically and nothing is locked in forever.

But having DB pensions for public sector workers is binding future parliaments into very large financial commitments that will leave them increasingly less wriggle room.

It would be one thing if they were defined contribution pots that were in each individual's name. That would operate independently and doesn't represent an obligation on future governments to pay out pensions out of future taxpayer money, maybe future taxpayers who have different priorities for what they want to spend the money on.

AIBU to think public sector salary culture should, if anything, be the reverse: high salaries now, because the government is legally not allowed to commit to future compensation in another government's name?

It’s current pensioners who have benefited from the best pension schemes public & private which is why as a generation they hold so much wealth.

That’s in total. Annually is about £55bn

What's with the anti-pension campaign on the boards today?

I've got nothing against pensions and saving for retirement in general. I have an issue with public sector DB pensions.

Still an enormous sum.

My husband is similar and if the public want to decrease his pension they will need to pay private sector wages. He could earn £7k a year more in the private sector.

They got tired of benefit bashing and the flow of immigrants has slowed to a trickle. It’s all there is left.

country is broke!

I accept this argument in general but I think I'm arguing that it's such a huge breach of trust to reverse the promise of a pension, that it effectively binds parliament even more than, say, being in the EU.

One could argue that borrowing costs are also in this category, I suppose. Not sure what I think about that, what's your opinion?

It's not just the public sector that has DB pensions, I have one in payment and I worked in the private sector, for a good international organisation. I know that they are not as common as they used to be but they are still available.
And in the public sector, as PPs say, it is a valuable and valued employment benefit which attracts and retains good employees.

Things are also changing.

LGPS has now (for people in my sector anyway) said we have to pay pension contributions and the employer has to pay pension contributions on any unpaid leave.

So I took a weeks unpaid leave as a carer - lost £600 in wages and then paid 6.9% of my unearned wage towards my pension.

I think things will change but it’s not simple math and it needs to be done alongside ensuring wages are livable, housing is affordable and social care is reliable.

I think they should do this.

Paying less today is an artificial subsidy that will come back to bite us.

Aren't teachers part of the LGPS?

I dont properly understand it so it should be illegal

Is there a reason you have not opted ro work in the public sector if its so great?

They are super rare now

What amazes me is none of you actually understand that crap wages for many years doesn’t mean a big pension. I worked 42 years in the nhs, leaving on a salary of 60k.
Like many colleagues I worked part time for several years to raise a family. (No free childcare, very few nurseries)
My pension is £12k.

I think teaching support staff are part of LGPS.

@parkintroubleno they are in the TPS

All this dialogue recently about pensions is so shortsighted. If you want to have a shit ton of public sector workers all poor when they're retired to make everyone feel better and 'make it fair' with private sector workers who are all being shafted by big business and greedy billionaires (race to the bottom anyone)? You will just create a problem down the road when they all have to claim pension credit and housing credit to survive.

Also you end up with a large population of older people with no spare income so they can't contribute anything to the economy by spending and likely their health outcomes will be worse (being poor tends to do that to you) and so more is spent on the NHS and other services to help them.

We have to look after our old people one way or another. Nobody is on final salary schemes anymore, so everyone needs to calm down and support legislation that helps private sector workers build better retirements so theyre not scrabbling around in old age either.

No, it’s that a pension of 12k on a crap salary is a huge “pot” for someone to try to create themselves.

I think you are forgetting that PS workers are also taxpayers too. And the vast majority of them are on comparatively low wages. I always like to point out on these threads that many Executive Officers in the civil service are also needing to claim UC.

I moved back to the public sector specifically for the pension & the annual leave & the sick pay. It makes sense as I get older.

You could say the same about the state pension.

Are you particularly jealous of someone you know who is receiving a DB pension?

Civil servants with DB pensions pay employee pension contributions (at quite a high rate) that then go to the Treasury to fund current spending so similar model to state pensions - do you want to get rid of that too - as that is basically an unfunded DB pension.

Ah.
I hadn't realised teachers sat outside the LGPS