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Tories to look at pensions.

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Tories to look at pensions.

Old 28th Nov 2008, 13:18
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Tories to look at pensions.

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How much do you think they could change things, both legally or before retention becomes critical (if it's not already)?
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Old 28th Nov 2008, 13:45
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To be honest they're behind the times. The CS put forward plans 2-3 years ago to scrap the final salary scheme as it exists. The real gold plated schemes (the non contributory ones) have been closed for years. Regardless of what the Tories say, the schemes will be gone soon.
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Old 28th Nov 2008, 15:22
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As it stands at the moment they cannot do anything "legally" as they are not in government...But should Joe Public vote them in they can then do whatever they want...they could scrap public pensions completely.


But....if they whatsoever as take one penny away from my pension then I...along with many, many others will be writing a letter of resignation and walking...
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Old 28th Nov 2008, 16:18
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So can they (any governement) change the terms of our pensions? Is this going to lead those joining the service being offered a different type than AFPS75/05?

We can put up with cr@p kit, lousy accom and all the rest of it but this a sacred cow too far surely
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Old 28th Nov 2008, 18:05
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Trouble is how many youngsters (ie 18-24 year olds!) who join the RAF really give a fig about their pension? Certainly didn't cross my mind! IMHO the first time most people who have joined the RAF think about their pension is when they are looking to leave! And its all too late then!!
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Old 28th Nov 2008, 19:54
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So can they (any governement) change the terms of our pensions?
Dirty, when the current lot 'tinkered' with the Teachers' Pension recently, the changes (not in 'till 2013) did not affect any rights already accrued. That eases the position for those past halfway. Depends where you are, I guess.
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Old 28th Nov 2008, 21:14
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Originally Posted by Wrathmonk
Trouble is how many youngsters (ie 18-24 year olds!) who join the RAF really give a fig about their pension? Certainly didn't cross my mind! IMHO the first time most people who have joined the RAF think about their pension is when they are looking to leave! And its all too late then!!
Oh, I considered the pension I was offered. I can still remember.

At 8 yrs a gratutity of £1,728, at 12 years it was £4,000. At 38 it was £1,203 and an annual pension of £401 exactly the same as married allowance.
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Old 28th Nov 2008, 23:35
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I retired some 4 years ago on half my then salary since when I've had a small increase. This is what the private sector calls a gold-plated pension. What they seem to forget is that I paid 6.75% of my salary into that pot and my employer a little more.

When the Teachers' Pension Scheme was first opened, Churchill asked that teachers contribute towards it for a couple of years to get the fund going and then the scheme would become non-contributory. The Emmott Committee recommended that the scheme be funded by HMG; had that been done, by 1972 it would have stood at £2000 million!

While acknowledging that my pension is more than some people get for working full-time for 40 hours a week, I must note that those in the private sector were very happy with their money-purchase schemes when the stock market was doing well.

They had no sympathy for public servants who pointed out the anomalies in their final salary schemes, not least that their funds seemed to consist of notional amounts and that pensions were being paid from superannuation income with no investment whatever.

Now the situation is reversed, they're squealing about the unfairness of it all. Hmm...

Nostrinian: it wasn't just the RN who was hit with pay reductions (all public servants had a cut of up to 15% in Snowden's 1931 Budget) but the cuts hit Jolly Jack that much harder because of the reduction in allotments and some sailors couldn't keep up with payments.

Last edited by exscribbler; 2nd Dec 2008 at 00:21.
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Old 29th Nov 2008, 09:11
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I would have thought (hoped???) that any major changes like scrapping / significantly re-structuring of the AFPS would be done in a similar way to the implementation of AFPS 05 i.e. if you're already in and serving on that scheme at a specific date, then you retain the benefit, but all personnel joining after that date go on to a new scheme. And what if you're already drawing your pension.

However, as Spheroid rightly states, this will be the final nail in the coffin for the Forces. As it stands, there are many experienced personnel, officers and NCOs who are effectively kept in by the 'pension trap'. Whilst not ideal to have your personnel motivated purely by money, you cannot get around the fact that it means a significant level of experience is retained. If you then open the trap door, you give people no incentive at all to stay and you can then watch your key personnel walking.

This is going to be a minefield, and ultimately, a real indication of the government's (either side) alleged commitment to the forces.
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Old 29th Nov 2008, 09:58
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Melchett01

I'm ex-forces so really hope you guys keep you pension as is... you deserve it. I see the pension as deferred pay.

However, it might be worth a quick look at the ATC issues section and check out the NATS Pensions thread.

We have currently got a 'gold plated' pension scheme, that was protected by deed of trust when NATS was part privatised in 2001.

NATS is responsible for the majority of UK airspace and as such is crucial for the economy, security and defence. If NATS employees were to strike, it is fair to say the UK would economy would collapse (even further).

HMG still owns 49% of NATS.

However, our pension is now under threat and it looks like it will be degraded, even for those people who are already in the scheme.

Be very wary of believing what anyone tells you when they say your rights are protected, and make sure you have a full understanding, otherwise they will try to screw you.

Good luck... I hope this thread is just conjecture and has no real substance
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Old 29th Nov 2008, 10:15
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So,

Just let me get this right, because I am having some real dificulty in getting my head around this. Ever since 1992 and the last recession the civilian private sector has enjoyed astronomical growth in all areas, with wage rises, bonuses and associated Terms and Conditions that the military could not achieve.

No bonuses, no company cars, no company telephones and no 'contract award' deals. The private sector was happy and content looking down at the Public Sector knowing that the salaries they were on and their pensions linked to the stock exchange made the military, police, fire and nurses the 'poor cousins' in career choices.

How many times in the city have people looked down their nose at me in a bar in the past when they find out that I am 'just an officer' in H M Forces. The arrogance and the noveau wealth has never worried me as I have always been very proud of my profession and I see wealth not purely in monetry terms. When I still talk to my friends in the city they still find it difficult to see why I worry about my pension when they are still living comfortably off their investments made from their bonuses over the last 10 years (and I re-itterate, not just the 'fat cat' bonuses - but normal on the shop floor middle and junior management bonuses). They do not worry about their pensions as they have sucked every last bit of money out the system to prepare them for the future-which has resulted in the Govt (i.e. you and I) bailing them out. This is not just the Financial Services Industry, but retail and to a lesser extent commodities.

However, and this is my point, why all of a sudden when the private sector no longer gets its bonuses (not just the fat cat ones - the junior manager level etc), no longer gets the company car or the mobile or the corporate wining and dining that the private sector then starts to look over the fence and want a slice of my pie and my investments that I have always known will look after me when my flying days are over and therefore do not need to go for a second career in the city trying to earn my fortune.

If you remove the pension in its current state, then as per CEA, you will lose the top quality and best serving officers, NCOs and men/women from all three services as they will see that there is no financial reason to stay.

There would be every 'push' into civvie street from all of the negative aspects of Service life that are discussed so often on this forum, combined this time with very little 'pull' to remain in the services. Serving for love of Queen and country can only go so far.

From the recruiting perspective, who are we trying to kid - the future armed forces youth of today are all over Ts&Cs and they will be able to quickly weigh up the limited fianancial opportunity that a full career will offer in comparison to the earning potential in the private sector.

Bonuses, company cars, private health schemes, re-location allowances, mobile phones, corporate entertainment have not gone - just put on hold and they will return to attract the real high flying youngsters of the future. Remove the forces pension scheme and try and align it to a private sector pension scheme will result in more people leaving (especially once they have 'ticked their flying/op tour box') and possibly result in a lower calibre of individual joining the forces as the lure of the private sector is too enticing in comparison.

Have I got this wrong, what am I missing?
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Old 29th Nov 2008, 10:28
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Exscribbler.

Your quote below shows how out of touch the public sector is with what is happening in the real world.

"I must note that those in the private sector were very happy with their money-purchase schemes when the stock market was doing well."

This is pure drival - before our unelected PM destroyed the private sector final salary schemes the UK pension sector, both public and private, was one of the best in the world. Once Brown had destroyed the final salary schemes companies moved pensioners into money purchase schemes which, unlike public sector pensions, give no guarentee of pension.

Why should the public sector not suffer the same as the private and be moved onto a money purchase scheme? Afterall public sector jobs are more secure than private sector jobs - I have yet to hear of a single public sector worker being made redundant recently.

This nettle has to be grasped now before nearly all tax revenue goes into paying unfunded public sector pensions. All new start public sector employees should be offered money purchase schemes with the employer contribution funded at the time by HMG.

AP
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Old 29th Nov 2008, 10:57
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It is simplistic to suggest that this is simply a measure of g’ment support for The Forces. The pension of 1 civil servant who earns say £30,000 takes the taxes of 2 working people (with the same income) to simply pay for it. Public pensions, whether you like it or not, are unsustainable in the medium term. It has little to do with g’ment faith in the military, little to do with who looks down their nose at who.. that’s just the way it is. We don’t have the projected income to continue to fund them, that’s the bottom line.

This might make interesting reading; from the Telegraph.

Public sector pensions: Just how generous are they? - Telegraph


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Old 29th Nov 2008, 11:23
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How does the UK Armed Forces Pension Scheme compare with those of other countries' military?

I only ask because a CF colleague was astonished at the low rates of RAF pensions for those who have served their time, compared to the rates in Canada.

As for 'final salary schemes', that's certainly not true for anyone who was paid flying pay.....

Any government (or prospective government) which even thinks about fiddling with military pensions is in for a nasty shock. Although the 'lump sum' might be difficult to defend.....

If whatever boarding school allowance is called these days was to be under threat and pensions 'under investigation', there would be nothing left to retain significant numbers of loyal armed forces personnel.
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Old 29th Nov 2008, 14:15
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Al R -

You're right, there is a sustainability gap in terms of public pensions, and the military ones especially. But the government - not just of today - is fully responsible for that. They are the ones that have refused to invest and have instead prefered to keep it as an unfunded commitment, for which money must be found from the budgets on an annual basis to meet its liabilities.

That this is now coming to bite them in the arse is their fault, not ours. They could have done something about it before now, but they chose not to do so. How long has pension affordability been a likely problem? Or are the current generation of politicians suddenly being taken by surprise?!!!

Once again, people are returning from theatres of war to a country fit for heroes. Only in this case, the heroes are lesbians who have had their feelings hurt and secretaries who have hurt their thumbs in a nasty computer related injury. It's just as bad now as it was in 1918, but nowadays, they have no excuse for saying pleading ignorance.
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Old 29th Nov 2008, 14:59
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From the DT article mentioned above

PUBLIC SECTOR WORKERS GET LOWER SALARIES BECAUSE OF THEIR GENEROUS PENSIONS, DON'T THEY?
A myth. They are better paid, until you get to the very highest levels of management.
The Pensions Policy Institute, an independent research charity, puts average public sector salaries at £25,600 and those in the private sector at £25,300, although the PPI says salaries soared in the private sector when it came to the very top jobs.

and

IS IT TRUE THAT PUBLIC SECTOR EMPLOYEES ALL RETIRE EARLY ON FAT PENSIONS?
Undoubtedly, public sector employees claimed "breakdown in health" pensions in surprisingly large numbers in the past.
Before 2000, for example, 68pc of all retirements in the firefighters' scheme were due to ill health, as were the retirements of 40pc of police officers, 23pc of NHS workers and members of the armed forces, 39pc of local authority workers and 25pc of teachers.


So now you know as a civil servant you have higher wages and retire earlier!! This is a very political issue (ie vote losing) involving many serving (about 5 million) and retired civil servants so I'm surprised the Tories are taking it on.

BB
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Old 29th Nov 2008, 15:41
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"The Pensions Policy Institute, an independent research charity, puts average public sector salaries at £25,600 and those in the private sector at £25,300, although the PPI says salaries soared in the private sector when it came to the very top jobs."

That is a debateable point - I've seen other research which says that for the MOD (and presumably the wider public sector), 50% of staff earn under 20K per year, and 75% of staff earn under 24K per year. There are opportunities for decent pay in the public sector, but they are few and far between outside of London.

Of course 99% of statistics can be made up on the spot :-)
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Old 29th Nov 2008, 16:06
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PUBLIC SECTOR WORKERS GET LOWER SALARIES BECAUSE OF THEIR GENEROUS PENSIONS, DON'T THEY?
A myth. They are better paid, until you get to the very highest levels of management.
Oh dear! The Torygraph really should check their facts! Here's a quote from the AFPRB 2007 Report:

We conclude that:
• With revisions to reflect changing circumstances, our methodology to
determine the relative pension value and how we apply that value to civilian comparator pay remain appropriate given that the Armed Forces have noncontributory pension schemes;
• The value should be 4 per cent; and
• The value will be deducted from the civilian pay comparisons from 1 April
2007, which will be part of the evidence for our 2008 Report.

As I understand things, Armed Forces pay is currently set 4% below equivalent civilian pay. However, given recent world events, I guess the desirability (if not the relative value) of all government pensions has increased. So I suppose all government employees (including MPs) shouldn't expect much of a pay rise this year!!!
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Old 29th Nov 2008, 16:25
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It's the pensions and early retirement [followed quickly by another job ] of teachers,police and fire service that really annoys the majority of people -and I don't mean the well paid ones in the City or wherever -I mean the majority of private sector workers on average wages whose pensions, if they have them, have been decimated by Brown and who have no hope of early retirement if they can ever retire.
Any government that reduces the pensions of those mentioned above and forces them to work to 65 at least would get a lot of support.
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Old 29th Nov 2008, 17:06
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Papa,

Just wrote a quick note in my diary...... just said 'Arse'!

Have a nice w/e

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