SO WHAT PENSION WOULD TEACHERS ACCEPT?

[keepontrukkin]

Posted as a teacher who won't be on strike on Thursday.

Coalition proposals are pretty clear if not very nice, but I have not seen anything about what unions are willing to accept. Do they want to keep status quo, in which case how do they think it should be paid for? Really? Or are they willing to accept reform - if so, what?

It would be nice to know...

SozyDod: useful briefing note on the scheme (2008) here.

Employee contibutions 6.4% Employer 14.1%. The scheme was then in deficit (2006, based on actuarial assumptions - bit of a black art) and head of ATF has said publicly that there are no up to date figures to show whether currently in deficit or not.

The current demographic/longevity evidence does exist.

so how can the government assert that the TPS is unsustainable if there is no evidence?

A very sensible older teacher (exhausted by teaching at 57) said tonight that she'd welcome a proposal whereby teaching hours decreased after 60, in steady steps, up until the future retirement age of 68. Part-time she thought might be do-able, but full time teaching in her mid to late 60s just made her want to cry in despair: I totally understand that.

And all the teachers I've spoken to say the same as mrz re wanting evidence about fund not being sustainable. They were given criteria to meet, they've met them, and now the deal is being changed: evidence is needed.

The evidence is in the increased longevity of the "baby boomers" and the Ponzi nature of the scheme. Those who are paying in are doing nothing for their own prospects - they are paying for the generation ahead. As they are living to mid 80s (rather than mid 70s), the burden on the current payers to meet the expectations of those about to retire is significantly increased, and will worsen for the next 20 years or so. Just as that "hump" begins to die off, there is the further whammy of lower longevity for those coming after (remember headlines about unhealthy kids dying before their parents - it won't be that dramatic - but it does leave a generation (unfairly) sandwiched by the demographics).

Pensions reform in the 00s should have been more wide-ranging. The writing is (and was) clearly on the wall. But, as with all long term problems, there was insufficient appetite to risk the unpopularity of tackling it properly. And quite a strength of feeling that these changes are all necessary (particularly the move to career average) - but that they could be put off a bit, and that delay was actually the most positive outcome that was achievable.

But they cannot be put off indefinitely. The wider financial crisis has meant that the structural deficit has to be tackled. The cost of unfunded public sector pensions is a huge item in projected Govt spending.

A viable alternative though, in terms of preserving the wider Budget, would be to cap Exchequer liability. Would you see that as preferable?

The evidence is that teachers live on average for 8 years after retirement. So increase retirement age by 8 years

Elibean: for that argument to stand, you have to assume that the criteria were both correct and sufficient. I do not share that assumption.

mrz: it's projected longevity that counts here, not that of recent past. 68 is remarkably low for recent life expectancy though (I'm assuming that any figures would have to be based on pre-revision retirement age as comparable post-transitional data wouldn't be available yet - please correct this assumption is wrong!).

ONS life expectancy tables. They put teachers (type 2 occupation) as living after age 65 (women) 17 rising to 19 years (dobs from 1970s to 1990s), and (men) 13 rising to 16 years.

I believe there is more detailed research, which separates teachers' life expectancy from other professionals listed in that table. I'm not sure I trust the evidence of that table any more than you are convinced by the criteria mentioned below, medetrina.

Unfortunately, I don't have a link to show you - or time to find one, more to the point - but maybe someone else can.