Pension Change
 

Public sector to lose 'final salary' pensions

:eek:

Well, as a career Flt Lt, salary averaging is going to work in my favour...


I take relief from this though:

3% I can cope with.

Then this:
Looks as if they get the message - f*ck with our pensions, and there is going to be hell to pay. didnt the original hutton prelim reccommend no changes to AF pensions anyhow?

One could argue that this is all that matters. When you have worked a lifetime and gone the extra mile on occasion focused on the long term reward, it is important that retirement expectation is not pulled in the final hours.

The work force of tomorrow; and indeed FNGs today, live in a world reaping the wrath of previous mis-management. There is an inevitable overswing and the long term security for new guys now is significantly less in fiscal terms. It may be adjusted to something more palatable in years to come, especially if demand does not match supply. A point for debate would be who is to blame? Is the present final salary pension scheme really untenable if not influenced by external demands on Govt by the financial sector. .....or an insistance by Govt to dance on the world stage as if the Empire remained.

Wind the clock back and we could have retained an appropriate military force, highly motivated and trained, that was armed with the technology required to protect the home nation, and meet our morale comittments to former colony countries. (Independence +50 years). But Govt instead chose us to be an american aircraft carrier permanently anchored off the european mainland.

It did; Hutton previously stated that SP should not start to pay personal contributions from salary – whether George Osborne accepts that is another issue - we'll have to wait until the budget to find out. Hutton knows that SP have their salary abated (gross) already to take account of the fact that they do not pay an active contribution.

So, if a personal contribution IS to be made, there would have to be a salary increase to compensate for it, and George Osborne has decreed that no public sector is to receive a salary increase for the next two years. It would present a devisive scenario, especially at a time when Plod is being asked to take a pay cut.

If everyone has to move across to the new (career averaging) scheme at outset, then Vin Rouge will be quids in (relatively speaking), compared to someone who is promotion flatlining for a long period and who then gets picked up at the tail end of a career.

The people who could get hurt in the near future are those who might get rolled up into the new National Employment Savings Trust after a full mil career. If you are in that, in your 50s, then somewhere in the region of 2% of your fund will go towards repaying the State start up costs. That investment shortfall mauling is NOT going to be recoverable in a 10 year window.

Now if 'career average' included all my flying pay...

Here's my question,

How much can the Govt change pensions ? Where does "Grandfather Rights" come into effect ? Is it anything that isn't being paid yet that can be changed ?

I cannot reply to the Grandfather Rights question with anything beyond logic. But it is so logical that I am confident of being correct.

In my own case, I have contributed to my pension over three decades with a 'hidden' payment from my monthly salary. This hidden payment is also potentially subject to rumour rather then documented fact. However, if true, then I have 'earned my pension', and it cannot be touched.

Based upon previous contentious changes to Terms of Service that I have witnessed over the years, the military will force your hand when accepting any of the following:

1) Promotion.
2) Extension of Service.
3) Structeral Change. Such as trade group amalgamation.
4) Commisioned Service if non-comissioned at present.

A condition of accepting the 'carrot' will be for you to subscribe to the 'stick'. You may turn down promotion/comission but an extension of service offer may eventually force you into a corner. The principle example I can recall concerns the removal of time promotion against reserve rights of pay. It took about 10 years to get as many on board as the system was ever going to achieve, and I dare say a few stragglers remain who have; over the years, rejected offers of promotion.

For the system to mandate a total change of pension policy would be to open the main gate and allow a tsunami of experienced operators to leave. It would be management suicide. Whilst we live in uncertain times; I would like to think that Manning have a grasp on the negative consequences of such action. In fairness, and especially pertinent to redundancy tranche three, Manning do appear to be conducting the slaughter with an element of gentlemanly behavour. ..though 170 baby pilots probably disagree with that.

... you would have received less flying pay as it would have been subject to the same % reduction as your basic salary.

But would have enhanced your pension.....:hmm:

When rumours of nuLabor proposals to fiddle with long-standing pension systems started, the pins on my black and yellow came out. When rumours became fact, that, coupled with the whole RAF starting to go incipient, caused me to pull the handle 2 years early - damn glad I did!

DR

Very good post and pretty much what I observed over a full career as well.

Beags

Agree and did the same myself (except I would delete "nulabour" and insert "all lying b****d politicians of any political persuasion")

Here's another report; this time from the FT:

Hutton seeks end of state final-pay pensions

Quote:

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In an effort to keep the change as simple as possible, Lord Hutton has come down against a cap on the amount of pension higher earners can receive, or switching them into a form of money purchase pension.

---

Quote:

---

Under the package, staff would keep the final salary pensions they have earned to date. However, all staff, not just new entrants, would be switched to career average pensions for their future service. There may also be controversy over the index Lord Hutton recommends for increasing the value of the pension earned each year.

---

http://www.pprune.org/terms-endearme...roster-fo.html

http://www.pprune.org/terms-endearme...ml#post6287560

Oh dear. Looks as if it is all about to get a bit interesting.

Did I not read it right when Hutton suggested leaving the armed forces out of these changes?

Yes, he did say that. But Hutton doesn't make the rules, he was taken onboard to offers Osborne advice and bought him breathing time and space, and act as an excuse Patsy. Transiting across to AFPS 13 (or whatever) might not be obligatory, but may well be should you wish to sign on or get promoted. Previously earned rights could well be preserved, so its not so much a loaded gun at your head; more, loaded kid gloves rubbing greedily together as you mull the alternatives.

This may or may not provide (cold comfort) and I hate to be a potential harbinger of doom, but The Armed Forces (Pensions and Compensation) Act was amended to read..

Retirement options are getting wider by the month. As the picture is dumbed down across the board, private company schemes will also come under increasing pressure. I have absolutely no doubt that in 'x' year/years, we will see some budget carriers signing up to NEST in order to mitigate an expensive and long term company commitment. The attitude will be '.. if you don't like it, fine.. then leave.'. There will always be some hungry mouth waiting to take your seat. In all honesrty, I would not be surprised if, in the wake of a massive overhaul, something similar was offered to new recruits. After all, if you are going to make changes, get the bad news out of the way now, rather than drip feed it over the coming years and endure death by a thousand cuts.

The concern within HM Forces is (as far as I can see) that there is going to be a multitude of individuals on differing contracts. Contracts such as PAX for instance, is that it probably is far from being the best product for most people.. but everyone is in it together and so, the blunty or Rock sitting at KAF is paying the same as the EOD operator out on the ground. In contrast, these widely differing levels of beneficial and opaque retirement benefits can only further undermine and dilute military ethos.. or perhaps people just won't care by then - who knows?

Reliance on the company or the MoD is getting a less and less likely option as the months/years go by, especially as the Basic State Pension is also going to overhauled and simplified to 'compensate'. £140 a week, anyone?!

Warning of public sector 'exodus’ over pensions

Armed Forces face shock in public pension reforms

Have to see if this affects gratuity and the ability to max commutate. If it does, o think a lot are going to walk... Not least the seniors of wg cdr-star rank who now sound as if they have the option of leaving now or working to much later. Quite frankly, it sucks, but the butchers bill from the last government needs to be paid.

Vin Rouge
 

"Have to see if this affects gratuity and the ability to max commutate. If it does, o think a lot are going to walk... Not least the seniors of wg cdr-star rank who now sound as if they have the option of leaving now or working to much later. Quite frankly, it sucks, but the butchers bill from the last government needs to be paid."

That's OK then. As long as it in the name of government profligacy then we should pay. What a load of hoop.

Absolute Betty Swallox. Pay is already reduced. Allowances are reduced and we know there are further MAJOR reductions coming (no entitlement to SFA or SLA post part 2 training - how do you like them apples? massive reduction in BSA). Now our pensions which don't forget we contribute to via a reduction in take home pay.

So if our pensions are now going to reduce massively (average earnings AND RPI to CPI) are we going to see a large increase in our pay packet to allow us to purchase additional pension provision? Not likely.

At the end of the day this is about reducing the cost of the public sector in the long term in order to recude the tax the super rich have to pay. It is a long term goal conveneintly hidden by the financial ineptitude of Blair, Broon and his cohorts.

In my opinion any remaining doubts that the armed forces covenant no longer exists has disappeared. It is time for us to have formal and robust representation in the form of an Armed Forces Federation akin to the police, and modern terms of service offering overtime, fixed hours etc.

This may seem backwards leaning, but the government and the taxpayer must realise you only get what you pay for and the reliance on the goodwill and 'can-do, will-do' attitude of service personnel is over.

'Tommy this and tommy that' indeed.

I hope to christ, allah, buddah and anyone else that'll listen that 2015 is the earliest that this will come in!:sad:

It does raise an 'interesting' situation - if you need to serve to age 60 to get your pension then how does that fit with having 'lean, deployable forces'? With fewer places in the services can we really have them taken up by old people pushing 60? So the idea of serving until pension will become a thing of the past except for very few, probably very senior officers. Everyone else gets pushed out early with no pension to compensate for the reduced income of having to start a new career at a late age.

So where's the incentive to stay in past about 35? Go early while you can still secure a good second career. If you do stay in the hope of achieving a high rank but don't make it you get forced out in middle age without a financial safety net.