D'oh.

I'm sorry, the country is being led by a buffoon. There is no other conclusion that is supported by evidence.

Maybe. But you could say the same if it was being led by Gordon Brown, Ed Balls (or which ever Balls is in charge of the reds these days) or Nick Clegg.

I still think public sector worker should be grateful for their pensions. Since Labour's tax raid killed off most final salary pensions, private sector workers have it much worse.

To give you an analogy, what you're saying is because your house was burgled, I should let my house be burgled so we're equally impoverished. I can't really agree to that. Private sector workers allowed their pensions to be eroded to pretty much nothing. In general, public sector workers don't really see the value in meekly following their example. There is a deal. Both sides agreed to it. One side doesn't want to stick to it, and it's not us. As the article suggests this is not purely a political dispute, because some of the people striking (head teachers, the senior civil servants etc) have a long history of not taking part in political strikes. It's about the government welching on a deal it can well afford to stick to, pure and simple.

We are grateful for our pensions. Very much so. That's why we'd prefer them not to get trashed by the government for dogmatic rather than economic reasons.

As the article said, the public service pension schemes have enough money in them to cope with projected demands (amazingly enough, they know when every member will be able to start claiming their pension. To the day! It's a wonder isn't it?). The scheme I am a member of is £4b in the black on projected demand. That's 4 BILLION and it's continued growing despite the 'harsh economic conditions'. The government line that the scheme must be butchered because it can't be afforded is a lie, pure and simple.

Jon

I wasn't going to strike, but after Cameron, Osborne, Maude and Alexander have all banged on about how inconsiderate and "irresponsible" my colleagues are for striking I might walk out after all.

A flawed analogy. You've already paid for stuff in your house. With pension changes the perks would stop now and future additions would be worth less. I still have my final salary pension from six years or work. It's just all my future pension that's based on defined contributions. When they closed it, they couldn't take it away as that had already been earned, my future contributions hadn't so the reduced pension from that is fine, even if I don't like it.

Just strikes me that everything has to be dragged down to the lowest possible level, and if you complain you are told off for it. No wonder we’re in such a state. There is literally nothing to aspire to. You can’t even look forward to a decent retirement now.

That's not exactly my understanding. My understanding is that the government wants to change public sector pensions from final salary to career average salary across the board, esentially devaluing any contributions already made as well as any future contributions that will also have to higher and made for a longer period. That's why they are waving the carrot of not doing that to people who have less than 10 years to retirement. It's the good old divide and conquer method sucessive governments and employers have been using for years. Or have I got completely the wrong idea there?

You can't blame the Govenment for this entirely - they're acting on the report by Lord Hutton - a former Labour peer?

I long since gave up trying to slide a piece of cigarette paper between the two of them, frankly.

Jon

You are both partially correct. It depends largely on when you want to 'cash in' your pension. In general, if you retire early, your pension is reduced pro-rata over the projected amount you were quoted as getting at 65 because, obviously, you haven't contributed as much as was expected. One of the changes the government's 'very generous offer' includes is that that recalculation will assume all payments after October 1st will be under the new scheme, even if the pension itself is under the old scheme.

Plus there is a general unease that, if the split between career average and final salary schemes is allowed, at some point in the near future everyone currently on the final salary scheme will be moved over to the career average scheme. Even if they retain higher value on the contributions made under the 'old' scheme, they will end up with a smaller pension if that happens, because any contributions after the change will be assessed under the new scheme.

Everyone in the sector stands to lose out in some way - be it in actual value or flexibility or both. The basis of the strike is in fact not really about any individual detail - it's about the fact the government is degrading the scheme when it doesn't need to be degraded. The scheme I'm enrolled in is entirely self-sufficient (according to the NAO) and is projected to remain so until well after I'm in the ground. The government is degrading the scheme not because it has to but because it wants to. The case for doing it is so factually weak that even normally quite conservative (small c) professional bodies like the Head Teacher's Association and First Division Association are coming down on the side of taking action. Hardly anyone who has examined the figures thinks the changes the government is pressing through are necessary. That's really the long and short of it.

Jon

This springs into to mind when I am reading another quality thread on subject of economics here at x404.
So comrades come rally, the International Proletariat ideal unites the Human race...
Enjoy

I have the Communist Manifesto on my iPad. I like the irony.

Don't the public sector pensions actually turn in a profit at the moment?

I'd hardly describe the Sir Humphreys of this world as 'the International Proletariat'. if you honestly think this is some sort of rabblerousing by the socialist worker brigade, you're not paying attention and/or you're swallowing just what the government tells you. Either of which is dangerous to your well being, in the long run.

Jon

Yes. They generally have for a very long time, and successive governments of both colours have creamed off that profit and dropped it into the exchequer. Plus, obviously, if you pay people a better pension they rely less on social welfare payments and are generally healthier for longer, so require less treatment by the NHS - although old people are still the most costly group for the NHS to treat as a whole, obviously. Far from being a drain on the public finances, the public sector pension schemes actually one of the government's better investments. Certainly better than the money we 'invested' in Northern Rock, for example.

As I've said, the scheme I subscribe to has been assessed by the National Audit Office, who found it was well funded and able to meet all it's future commitments, as extrapolated from current funds and number and age of participants. The schemes work. The schemes overall are roughly neutral in terms of government finance.

if you consider that paying one set of people decent pensions and another set poor pensions is unfair, and further consider that the correct solution to this unfairness is to make sure the people who have decent pensions get poor ones instead, then the government's position makes sense.

Jon