Public sector pensions facing 'reform' aka. 'the chop'

[localzuk]

It has long been accepted in the public sector that whilst our pay is generally lower than that of our private sector colleagues, we make up for that difference with a decent benefits package - pensions, holidays etc...

 

It seems that the government now thinks it is unfair to be paying us public sector workers a fair wage, and also its unfair to be giving us a decent retirement plan.

 

I'm only 25 and I'm worried about this. What is the point of accepting much lower pay than in industry to work in the public sector, if we get s****d over every time the government needs a couple of quid?

 

Sure, I accept that we need to cut our deficit, but there are plenty of areas where this can be done, without completely messing up the future of those people who keep the government and its departments running.

 

Its a bit depressing really...

 

BBC News - Public sector pension costs 'to double in five years'

[nicholab]

It more to do with civil service pensions which are gold plated and protected. The difficult thing I faced thought was that the old pension scheme my employer was only putting in 6% put with the LGPS they put in 20%. It is also to do with how the pension scheme is run is not your pension your paying for but the a person who is currently retired.

[broc]

As I understand it, not all Govt pension schemes are properly funded & backed by investments & assets, some are funded from Govt revenue and these costs will be directly affected by an increase in the number of people retiring. A properly funded pension scheme has assets that is managed to provide funds when they are needed, private sector pension funds end up with 'holes' in them because employers take holidays from making their contributions when the investment funds do well & complain when the funds don't do well & they have to make up the shortfall.

 

Unfortunately all 'public' sector workers are tarred with the same brush. I believe all(most?) local government workers pensions are properly funded. I am not sure if the teachers pension is.... I believe it wasn't in the past.

 

The average local government pension is around £4000 pa, hardly gold-plated......

[Rydra]

Don't know how many people know this, but with the LGPS, as long as you put into it for the next 25 or however many years, you can be a street cleaner earning £8,000 a year for those 25 years. But if in the 26th year you become the director for cleaning services earning 85,000, you can take early retirement that year (assuming no contracts tying you for longer) and you'd get a pension based on that last year, not on the 25 years of input beforehand.

Why else do you think so many of the highest ranking jobs are held by, shall we say, those who are 'close to retirement'

[srochford]

Don't know how many people know this, but with the LGPS, as long as you put into it for the next 25 or however many years, you can be a street cleaner earning £8,000 a year for those 25 years. But if in the 26th year you become the director for cleaning services earning 85,000, you can take early retirement that year (assuming no contracts tying you for longer) and you'd get a pension based on that last year, not on the 25 years of input beforehand.

Why else do you think so many of the highest ranking jobs are held by, shall we say, those who are 'close to retirement'

 

That's not completely true - eg in the teacher scheme the pension is based on the salary for the last 3 years and it's similar in a lot of other schemes.

 

It's also unrealistic to suggest that there are going to be many street cleaners who will have spent 25 years as a cleaner and will magically become director of cleaning services for the final year of their career (particularly as most of the street cleaning services are outsourced anyway!)

 

Finally, if you look at any organisation, private or public, you'll find that the highest ranking jobs are held by those who are closer to retirement - it's pretty rare for someone to get a job as director at the age of 21 and then work their way down the management chain until they retire!!

 

What we ought to be saying is not "how dreadful, public sector workers get a reasonable pension - we must take it away from them" but "how dreadful, private sector workers get a very poor pension - how can we make sure they get a better pension"

[broc]

What we ought to be saying is not "how dreadful, public sector workers get a reasonable pension - we must take it away from them" but "how dreadful, private sector workers get a very poor pension - how can we make sure they get a better pension"

 

Entirely agree with you; unfortunately the message seems to be "We (private sector workers) have been stitched up by our employers, so the public sector workers deserve stitching up too."

[andyturpie]

It gets my goat this schizzle between private and public sectors. The BBC have your say is rife with people who attack the public sector. Its common knowledge that public sector jobs are lower paid and pensions are higher, but people forget they have EVERY oppertunity to decide which sector they want to work in and if they choose private then thats completely their choice to do so. My opinion is that the financial crisis was created by the private sector and the public sector are the very first to be targeted.

[andyturpie]

Also, we had large class devide under thatcher in the 70s and 80s. Are we now going down the same road using different terms for it?

[AyatollahPies]

I'm sorry, but these days public sector pay is on a par, or better than the equivalent in the private sector, especially in IT Support.

 

However, I agree that just because the private sector pensions have been destroyed, that is no reason to turn on those in the public sector.

[SpuffMonkey]

Entirely agree with you; unfortunately the message seems to be "We (private sector workers) have been stitched up by our employers, so the public sector workers deserve stitching up too."

 

Agree with you there - I got scr**ed over twice in the private sector - once by the firm and once by the pension provider, so last time I was made redundant I opted to take a lower paid job but a safe pension (given I was then over 40 and had little provision. I will be seriously dischuffed to get b*ggered about again simply to cough up my pension to ensure that the bankers don't have to pay their fair whack (anyone else watch Dispatches last night with Will Hutton?)

[sandeep2504]

I've been giving serious thought to stopping my pension payments and using an ISA as an pension pot.

 

currently in LGPS.

 

i just don't trust the government with my money and at retirement don't want to be shafted over.

 

do you guys still think its worth?

[elsiegee40]

I work in the private sector having worked in the public sector and, in terms of pay and conditions, the public sector gets a better deal.

 

Formal payscales - annual increments - annual pay rises - they're all part and parcel of working for state schools.

 

In private schools, particularly in these credit crunch times, our Bursars govern their fee income with a rod of iron. Spending does not come easily on anything unless it's to impress prospective parents!

 

I went 3 years here before I got a pay rise.

[Rydra]

I'm sorry, but these days public sector pay is on a par, or better than the equivalent in the private sector, especially in IT Support.

 

However, I agree that just because the private sector pensions have been destroyed, that is no reason to turn on those in the public sector.

 

This is not quite true.

 

Though with some fields it is hard to actually find a private equivalent, private earn a lot more than public sector.

 

My dad works for local government, after he was made redundant. He took a 15,000 paycut, doing the same work.

Myself, I can earn 2-5,000 more by working on a helpdesk doing nothing but answer phone calls all day. I know this, because I was OFFERED the job, only to be turned it down when the manager got my CV, as I had TOO MUCH experience. He wanted someone who would be willing to work for a few years, and decided i was overqualified, and likely to get bored within 3-6 months.

Private sector wise, I could earn the best part of 8-10k more than I earn now, even working within education (such as for a support company) than I do now, for literally the same job.

 

A teacher working for a private school will earn considerably more than they will working for a public state school as well.

[andyturpie]

I'm sorry, but these days public sector pay is on a par, or better than the equivalent in the private sector, especially in IT Support.

 

However, I agree that just because the private sector pensions have been destroyed, that is no reason to turn on those in the public sector.

 

I would disagree with the on par or better, but the margin is getting smaller. Just look at IT recruitment websites and you can still see a 5-7k difference in some roles. But that maybe down to the individual company wanting to take someone on and look to retain rather than keep having to re advertise and re interview at extra cost when people take flight

[Rydra]

The difference is, I work in a school, they will always need IT support of some sort. Working for any other company, there is no guarantee how long till they win/lose business, or decide to move or downsize, plus a lot have pensions tied to investment schemes, so you are taking a gamble. I have family who have lost tens of thousands of pounds in invested money into these pensions.

[andyturpie]

As a pension scheme with my 17 years paid into the Post Office Pension Scheme (which I thought was a great scheme), I will have achieved the equivilent in 6 years in my school pension scheme

[elsiegee40]

A teacher working for a private school will earn considerably more than they will working for a public state school as well.

Absolute rubbish!

 

Sorry you've annoyed me!

 

Teachers here follow the same payscales as teachers in state schools and don't earn more. Compared to the support staff they get a good deal, because they're in the teacher's pension scheme and benefit from the national pay rounds - we don't.

 

If we appear to get paid more, just think of the hours. Our schools are generally open to children from dawn til dusk and many of us are open at weekends too... private schools get their pound of flesh from their staff.

 

Very few private schools have the wealthy backgrounds of Eton, Harrow & Westminstrer.

 

Most private schools are smaller concerns like us. They absolutely DO NOT have cash to splash around.

 

On top of the reducing fee income due to the recession, we also have to pay VAT on all our purchases making everything we buy 17.5% more expensive than what state schools buy AND we don't have the benefit of LA bulk purchase.

[Linfit]

I also get extremely annoyed by this rhetoric. The media seem to believe that public sector workers get gold plated pensions at other people's expense, but there are a number of subtle issues around this which are lost on the average Daily Mail Hack with a political agenda. Whilst some top end public sector chief exec type pensions are ridiculous, and these get highlighted in the media as a general example, this is also true in the private sector, and most people in the public sector get small pensions because they are part time or only have a limited number of contribution years. There is also a distinction between the various local government schemes, which I suspect most of us are in, which are backed by an investment fund, and the NHS, Teachers, Fire Service (and others) schemes which are Pay as You Go - in other words, if the amount coming in from curent employees does not match the amount being paid out to retired members, the shortfall has to be funded from general taxation. Historically, this was a net benefit to the government as most people who paid into the schemes died before they got their money back, but these days people are living too long and buggering up the arithmetic.

 

Whilst the LG schemes backed by a fund may have a long term structural problem which they need to address, the outgoings are not paid from Central Governent funds, so the real issue is with the Pay as you Go schemes, as cutting them would be a direct saving for the Government.

[beeswax]

I recently saw a job description for a post at a private school where it was stipulated that the network had to be supported 24/7, 365 days a year. As I work in the state sector I don't know if this is the norm, but wouldn't be surprised.

[AyatollahPies]

I would disagree with the on par or better, but the margin is getting smaller. Just look at IT recruitment websites and you can still see a 5-7k difference in some roles. But that maybe down to the individual company wanting to take someone on and look to retain rather than keep having to re advertise and re interview at extra cost when people take flight

 

Well I'm basing my opinion on recent job adverts, and in terms of qualifications required for the job, in return for a decent salary, the public sector get a far better deal. Perhaps that's more of a problem with HR in the private sector asking for every skill set under the sun and offering peanuts in return. Most jobs in Education IT support seem to be happy if you are "working towards" an MCSE etc. Well, you could argue that having an MCP is working towards an MCSE. (Yes, that's quite a large generalisation, but it seems very common)

 

I'm aware there are many that contribute to Edugeek that are on very low salaries, but I'm also aware of the same in the private sector, and the conditions are stress seem far worse there. Of course, there are always exceptions, as described by Rydra.

 

From personal experience and speaking with colleagues that have left public sector employment to go in to the private sector and Vice versa, the consensus is that we have it damn good in the Public sector, pension or not.

 

Like Sandeep2504, I too am seriously considering stopping payment into the LGPS, as I do not believe my those under 50, are going to get anywhere near as good a return as my parents generation, that are due to retire within the next couple of years. The majority of colleagues under 30, do not contribute to the LGPS, so as it stands, I am at the bottom of the giant Pyramid scheme.

[Rydra]

Absolute rubbish!

 

Sorry you've annoyed me!

 

Teachers here follow the same payscales as teachers in state schools and don't earn more. Compared to the support staff they get a good deal, because they're in the teacher's pension scheme and benefit from the national pay rounds - we don't.

 

If we appear to get paid more, just think of the hours. Our schools are generally open to children from dawn til dusk and many of us are open at weekends too... private schools get their pound of flesh from their staff.

 

Very few private schools have the wealthy backgrounds of Eton, Harrow & Westminstrer.

 

Most private schools are smaller concerns like us. They absolutely DO NOT have cash to splash around.

 

On top of the reducing fee income due to the recession, we also have to pay VAT on all our purchases making everything we buy 17.5% more expensive than what state schools buy AND we don't have the benefit of LA bulk purchase.

 

If this is the case then I honestly apologise, but the few private schools i've known, and the few teachers i've known (about 3 or 4) that have moved from public to these private schools, all of them increased salary by up to 40% or so over what they earnt before. I admit to working in east england, where we have a number of well established private schools with high reputations, so maybe I have a limited viewpoint on this one. Hertfordshire is well known for some nice private schools, and I have London not too far away as well. I can see your viewpoint on the smaller private schools though, and stand corrected on the basis of what you say.

[localzuk]

I'm sorry, but these days public sector pay is on a par, or better than the equivalent in the private sector, especially in IT Support.

 

However, I agree that just because the private sector pensions have been destroyed, that is no reason to turn on those in the public sector.

 

Not true. I have seen helpdesk jobs going for more than I get paid here as a network manager. Someone with equal responsibility as I have seems to get a good £10k more in private industry.

[elsiegee40]

Not true. I have seen helpdesk jobs going for more than I get paid here as a network manager. Someone with equal responsibility as I have seems to get a good £10k more in private industry.

 

I think there's a confusion between private sector as in "Private Schools" and private sector as in "non school businesses"

 

I agree that jobs in the private sector (rather than private schools) are better paid - jobs in private schools are not necessarily so.

 

If you take the case of a job at a local private school that was posted on the edugeek jobs board a few weeks ago. The salary of £25k looked good for what they wanted until you realised that they wanted you to work Saturday mornings and Sunday afternoons!