So you thought your pension was safe!

[ANAPROP]

Gordo want's to get rid of the MP's final salary pension scheme as a precursor to doing the same for the entire public sector!

Gordon Brown to scrap final salary pensions for MPs - Telegraph

The move by Mr Brown could eventually allow politicians to propose scrapping all public-sector final salary schemes...

I've thought for many years that the Govt would find a way to cheat me out of my pension prior to retirement. Unfortunately this is seen as a vote winner by Brown as

These pensions have proved increasingly controversial as private-sector employees have seen their taxes continue to fund the retirement of those working in the public sector while the value of their own funds has shrunk.

Looks like the light at the end of the tunnel is about to be turned off...

[Gnd]

Well sort off, you will now be able to stay in untill 65 and the state pension will cover the short fall - Happy days!!!!!!!!!!

[tucumseh]

The Prime Minister has called for an investigation into how MPs’ retirements are funded because he fears they are becoming too expensive for the taxpayer.

I thought their retirements were funded through lucrative directorships with companies on whose behalf they'd lobbied.

[ADVOCATE_56]

We should be wary, but. Any review is going to be "managed" by the Sir Humphreys who have a vested interest. There is going to be a General Election in the next 15 months ( Zanu Liebour's 5 years expires on Thursday, 5 May 2010 ) and having built up the client state over the previous 13 years, they are not going to alienate all those public sector employees by seeking a mandate to trash their (our) pensions. Assuming Cameron gets the nod on 5th May next year, he is going to be so busy trying to find a way out of the dung heap that Bliar/Broon have created that he will not want to take on the Public Sector.

At present I think the bigger worry is whether the money will last until May 2010.

[Flying Serpent]

end of the final salary pension.

Unfortunately for most of us I think that this is inevitable.
What will replace it? A career averaged pension?

I had the option of a higher paid but less secure job in the private sector a few years ago but chose to stay in the public sector because the overall package of job security, pension and working conditions were better for me and the family.
Besides I actually like what I do.

I don't mind if Gordo wants to ditch the final salary scheme. However he should do the right thing and give us decent pay rises on time and ensure our rates of pay are similar to the private sector!

FS

[Al R]

I hate to say it, but this HAS to be done.

There is simply not enough money to pay the ageing (State employed) population such a generous pension. Its not right and its not fair, but thats the reality and who brings it about isn't the real issue here, but when. Of course, Brown will want to hand Cameron the poisoned chalice who, in fairness, has called for this for quite a while now.

David Cameron: Time to slash public sector pensions | This is Money

The tragedy is, many of the defined contribution schemes which replaced them are now being hammered as the rules are less onerous, as people can't contribute, and as the markets got hammered and as new 2012 pensions legislation is on the horizon anyway.

[SRENNAPS]

I don't mind if Gordo wants to ditch the final salary scheme. However he should do the right thing and give us decent pay rises on time and ensure our rates of pay are similar to the private sector!

On behalf of my wife who has spent many years working for the MOD and continues to do so with total loyalty, despite the fact of rubbish pay rises, several months late.

Flying Serpent - WELL SAID

She also enjoys her job and feels that she is doing her bit to support the lads and lasses out there.

[Beatriz Fontana]

Al R,

That's exactly what I thought when the news broke. A feeling of dread. A lot of the civil servants I know got on to the final salary scheme before it closed (nearly ten years ago now). To be told that it's closing anyway is going to be the proverbial nightmare.

One of the biggest draws to public sector work was the pension - the pay below the senior civil service is, to say the least, crap.

I wouldn't be surprised to see colleagues leaving the service and thereby opening the way for more higher-paid temporary consultants to fill the gaps. It's a false economy.

[capewrath]

Al R wrote:-
"I hate to say it, but this HAS to be done.

There is simply not enough money to pay the ageing (State employed) population such a generous pension. Its not right and its not fair, but thats the reality and who brings it about isn't the real issue here, but when. Of course, Brown will want to hand Cameron the poisoned chalice who, in fairness, has called for this for quite a while now."

That is perfectly true, but part of the problem is that there are far too many people working in the public sector and the numbers are ever increasing.
In some areas 25% of council tax revenue is used just to meet public sector pensions. That is grossly unfair.

[Door Slider]

Forgive my ignorance but I assumed that being on a 'contract' with a final salary pension scheme then that would still stand even if the government decided to scrap it. I would have thought that the new pension what ever that may be would be for people signing on after its inception date, am I wrong??

Thanks.

For anyone that reads the AFPRB report every year the table which compares civilian to military lifestyle and perks etc then one of the few remaining perks of military life is the pension, guess there will be none soon, kiss good bye to the education allowance too!

[Al R]

Beattie,

I suppose the only advantage one has, is time in being able to plan ahead. If possible, consider the pros and cons of contributing more into your scheme to boost benefits.

[Al R]

Capewrath,

I agree, 100%. How many expensively, corporately uniformed reception staff do there need to be at my local Council offices? Brown had to do it to reduce the burden on the private sector and to make the dole queues look shorter. And because at heart of course, he's still an insecure control freakery obsessed Socialist in a shiny suit who couldn't make ends meet if his life depended on it.

[Pontius Navigator]

Read the article closely. It is a master piece by Sir Humphrey:

The Prime Minister has called for an investigation . . .

The move by Mr Brown could eventually

the option of ending final salary schemes examined.

A Number 10 source said: “The Prime Minister is keen to move

Or as Mrs PN said, like getting Turkeys to vote for Christmas.

[jim2673]

Not exactly going to be retention positive is it?

How many people do i personally know that have done 12 years on the AFPS 75 scheme that are in the pension trap of having to do 22 age 40. If the geovernment scraps the immediate pension and gratuity payment after 22 i see many , read that as 10's of thousands of military men going ASAP.

The thought of a immedaite pension after 22 years is the only thing that keeps a lot after 12 years.

Also my D/V settlement was based on the fact that age 40,my pension CETV was valued at £250,000. How many will be seeking readress of their D/V settlement if the pension does not exsist untill age 65/70?

[Melchett01]

I hate to say it, but this HAS to be done

No it doesn't.

What HAS to be done, is the introduction of proper financial management practices to actually fund these pensions properly rather than requiring them to be funded from the annual budgets in competition with salaries, R&D budgets, equipment funding, day-to-day running costs etc.

If you know that you have a large financial obligation looming , you either budget for it or face the consequences of chosing not to. As an example, many people on this forum will have thought about the education of their children: possibly the the costs associated with boarding schools (above the CEA), potentially the costs of private day education, and almost certainly the likely costs of a university education. And I can guarantee you have probably thought long and hard about how to fund those future known liabilities and have taken steps to do so. If you hadn't and then came on here complaining about the costs, you would be packed off with fairly short shrift and not a lot of sympathy.

So why does the Government - of whatever hue - think we should be sympathetic to the fact that they have done absolutely nothing to fund their known liabilities apart from to take the money out of existing funds that they know will also have to fund other current liabilities? The public sector pensions row could have been sorted years ago by correctly funding these pensions through whatever scheme they chose - govt backed securities, investment funds for example etc etc etc. Armed Forces pensions should be seen as part of the costs associated with having a professional military to defend the country, not a bonus or perk as many seem to think at the moment.

However, now we are faced with a growing financial and social crisis - none of which is the fault of the Armed Forces, but which has the potential to to devastate the Forces if the pensions go. Given that the pensions are funded out of the annual defence budget, the general public will see this and ask why, when troops are short of kit and dying on dusty battlefields, should we be paying for retired people to live a comfortable life when young men and women desperately need the money to be spent on operational equipment. The fact that we know that operational funding comes out of separate budgets is irrelevant; the general public largely don't know this or care. This political element, with an election looming, is a massive driver for all the main parties.

The other aspect is the comparison between public and private sector working practices, salaries and pensions. There is a growing outcry that why should the public sectors receive these gold plated pensions when we don't and yet we have to fund them? A valid question. Almost.

What those complaining of a pensions apartheid have singlularly failed to grasp is the fact that for far too long, public sector employees were the poor relations when it came to renumeration packages. Certainly in the Forces there were none of the large bonuses, commercial salaries and other benefits and allowances that were available to private sector employees. In fact, I don't think it would be so unfair as to say that in recent years, many of the Forces consider they have received a bonus simply by surving operational tours and being able to see their familiies again. The point here is that for all too long, the private sector - particularly in the City and the big multi-nationals - have been happy to take the fruits of their 'successes' and keep them all for themselves to fund comfortable, sometimes lavish lifestyles. But now those 'successes' are being seen for what they really were, we are expected to share in their pain.

But with an election looming (possibly sooner than we all think, but that's another issue), this is rapidly gaining traction as a political issue. As PN pointed out, those announcements were very carefully worded, and unfortunately, we are now relying on those same self-serving Sir Humphries and MPs to save our pensions. Not an ideal situation, but it's where we are. And now it comes to a trade off - will the turkeys vote for Christmas or will the MPs making a bid for power win out?

The Armed Forces' Pension Scheme has already been downgraded (for most) through the change to 05. I can only hope that doing this will be enough to keep the wolves at bay for those currently serving. If there is to be yet another change and the closure of the AFPS, I can only hope that there will be a sense of justice, and those that are currently in that scheme and have served their country will be allowed to retain their pensions with a new scheme introduced from a point in the future. However, I won't hold my breath. Justice ,and what is actually right and proper rarely, gets a look in amongst the 21st century politicians and self-centred elements of the electorate. However, failure to tackle this issue in a just manner will create an even bigger problem for the government and the country that far outweighs the current pensions crisis: namely the devastation of the Forces. Thousands will walk either early or at their next option points; there will an erosion of trust between the members of the Forces and the senior leadership, who will be perceived not to have stood up for their personnel. This will impact on operational effectiveness along with a wholesale rejection by the Forces of anything the government says. In short, this has the potential to cause serious damage to the country as a whole if those conducting any inquiry or making the decisions do not do so having taken a broader view, and not just been swayed by short term balance sheets and political aspirations.

Fingers crossed, but not overly hopeful.

[sisemen]

the general public will see this and ask why, when troops are short of kit and dying on dusty battlefields, should we be paying for retired people to live a comfortable life when young men and women desperately need the money to be spent on operational equipment

Because for my 30 years they abated (read 'took') 11% out of my pay to fund my pension. That's why I have no qualms at all about looking at my bank statement each month.

If the government have dropped a bollock in making adequate provision for those entitlements then that is their problem.

Hark, I hear the tumbrils moving and the rusty creak of Madame Guillotine!

[EdSett100]

I don't think either AFPS 75 or AFPS 05 will be amended/replaced anytime soon. The vast majority of service personnel do not remain in the forces until age 55, when the big final salary based pensions are payable. Service to age 55 will not be offered on a widespread basis, as it is has been in the past. EDPs will be the norm for most people and the average EDP is not a large income by any means. I guess that most middle age MOD civilians and other public sector employees remain with the government until age 65, which does attract a large pension for most of them. I think it these people that the PM has in mind.

[charliegolf]

Melchett said:

The Armed Forces' Pension Scheme has already been downgraded (for most) through the change to 05.

That, i think, might be the saving grace, at least for current members, and for a while. This is already happening in some areas like teaching. That gives any government the opportunity to talk big and do nothing.

Big talk on climate change and carbon reduction are examples of this. X reduction by 2015- that's 2 more elections away! A lot of long grass then.

CG

[Biggus]

EdSett100

Reference your comment...

"Service to age 55 will not be offered on a widespread basis, as it is has been in the past...."

ACOS manning have, due to a shortage of personnel in the RAF, actively considered the option to extend the retirement age to 60 (as the RAAF have apparently recently done) - but instead, they are going to make more use of extensions past 55 than they have done in the past. In the light of this information I would suggest your comments above are not very accurate....

[jim2673]

FAA Exteneded Career selection signal last year had a splattering of age 55 restrictions. From the last 2 years Ec selections it's apparant that (1) If you have a pulse you 'll get selected.(2) 18% shortfall in SK and Lynx Avionic supervisors as listed in Hansard remains extant and could be quite possibly getting worse.