I left this year after 16 years. Would definitely do it all again and it was with considerable reluctance that I turned down the PAS offers and several excellent tours from the poster.
In general I agree with pretty much all the points people have made on here. If the question is about improving service life then the hierarchy have a lot of work to do! If its purely a question of retaining people then, from my personnel experience money talks. Thats what would have kept me in anyway. A sizeable, mortgage/life changing, quantity of money! As divisive as FRI's are, flying pay is (IMHO) equally bad for morale. On my last Squadron I worked alongside people who had only just started getting SP and would never, realistically, be in a position to ever get to enhanced rate. Longer term, a totally separate pay scale for pilots is the only way to go.
I don't believe its mentioned enough on this thread the effect service life has on family, including the education of children, provision of medical and dental treatment and the employment prospects for spouses. This is the single biggest reason I left. Even if I earn a third of my final RAF salary, I am now in a part of the country I have decided to live in, my kids are in decent schools and will be able to stay in them for as long as we decide to stay where we are and my wife works (which she enjoys I might add!). When you look at combined salaries and the reduction in tax then take home pay is not that different, if not better and quality of life has gone up dramatically!
But I don't get to fly cool aircraft! Will never ever regret I joined the RAF.