This post might well bore the backside of anyone outside the UK. Then again it might bore the backside of just about anyone in the UK as well! Nonetheless - the blogsite is called "drivel and wisdom" and it is time to rebalance. There has been too much drivel lately, both on this site and in the debate on UK public sector pensions.
We had a national strike of public sector workers this week, complaining about having to work longer and pay more into their "gold-plated" pensions. On the face of it you want to sympathise. However being in the private sector I have seen my pension eroded in terms of my retirement date and my contributions (I have to pay more and more in to get the same benefit). The argument from civil servants has been, for many years, that their pensions are a compensation for lower incomes than the private sector.
Here are some facts from the Office of National Statistics.
In 2010 the median weekly income in the public sector was £554
The median weekly income for the private sector was .........£473!
(The "median" is used as a more accurate measure than a simple average)
A difference of over £4,000 per annum in favour of public sector workers. My sympathies are now a little stretched!
Why are the government choosing to take action on the cost of public sector pensions?
Because the current cost of them will rise from £21 bn to £80 bn over the next forty years - to put that in context - ten years ago the cost was 1.5% of UK GDP. If nothing is done that will rise 2.0% of GDP.
In the last five years the contributions made by empoloyers in the private sector to pension schemes fell by more than ten per cent.
I am going on stike next week, a one-man-band strike, protesting about how much I have to pay in taxes to let other people have a better retirement, higher income and who make no contribution to our economic success!
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We had a national strike of public sector workers this week, complaining about having to work longer and pay more into their "gold-plated" pensions. On the face of it you want to sympathise. However being in the private sector I have seen my pension eroded in terms of my retirement date and my contributions (I have to pay more and more in to get the same benefit). The argument from civil servants has been, for many years, that their pensions are a compensation for lower incomes than the private sector.
Here are some facts from the Office of National Statistics.
In 2010 the median weekly income in the public sector was £554
The median weekly income for the private sector was .........£473!
(The "median" is used as a more accurate measure than a simple average)
A difference of over £4,000 per annum in favour of public sector workers. My sympathies are now a little stretched!
Why are the government choosing to take action on the cost of public sector pensions?
Because the current cost of them will rise from £21 bn to £80 bn over the next forty years - to put that in context - ten years ago the cost was 1.5% of UK GDP. If nothing is done that will rise 2.0% of GDP.
In the last five years the contributions made by empoloyers in the private sector to pension schemes fell by more than ten per cent.
I am going on stike next week, a one-man-band strike, protesting about how much I have to pay in taxes to let other people have a better retirement, higher income and who make no contribution to our economic success!
Come the revolution brother....
All comments gratefully received!!
Morning Brother!
ReplyDeleteI feel your pain - I have the joy of a state pension to look forward to! Happy days. I do not wish to whinge, but there's no way I could pay into a separate fund. Still at least I will have the lovely warm feeling that all those public sector workers will be enjoying a comfortable retirement! Share the love. Off to stoke the brazier now, see you on the front line.
Ah, spoken like a true economist.
ReplyDeleteI was in the public sector and took part in 3 war zones. Acting on behalf of the country, I feel somehow entitled to my Forces pension. I've paid for it in other ways that don't have a financial value and, therefore, don't show up on the boardroom accounts.
With all the political interference that teachers have to put up with, I have no problem paying taxes to fund their pensions, nor to the serviceman returning from Afghanistan, in good health, God willing.
The conditions that an employee signs are for the most part none of their doing. Somewhere down the line, through no fault of their own, they suddenly find themselves having to fight for the benefits that were given to them as if somehow their "gold-plated" pensions were their fault. Enter the "divide-and-conquer" mentality and all of a sudden service personnel and teachers are being demonised as somehow greedy. Isn't it funny how working practices are imposed or suitable equipment denied with the excuse of, "Well, at least they get a good pension to compensate..."
Ask yourself: why has your private sector pension been eroded?
All the best
The Doc