Civil Service Pensions

[Slim]

people forget government workers are paying twice into the pot for pensions, through monthly contributions and through tax! for their future pension and for people drawing their pension right now. i think paying twice qualifies for a bit of whinging about the current proposals.

 

Wha, hows that different from our private pensions? We're paying twice too, the same amount of tax and the same amount into our pension funds that are currently being raped by falling markets. Why should we have risk and you not?

[BETTYBOO68]

people forget government workers are paying twice into the pot for pensions, through monthly contributions and through tax! for their future pension and for people drawing their pension right now. i think paying twice qualifies for a bit of whinging about the current proposals.

 

Wha, hows that different from our private pensions? We're paying twice too, the same amount of tax and the same amount into our pension funds that are currently being raped by falling markets. Why should we have risk and you not?

 

 

Slim i have'nt mentioned private pensions or their risk or been different to public sector. my repsonse was to someone who said public sectors workers pay basically pay nothing into the pension fund! and that we are entitle to whinge contrary to what he thinks about public sector workers, I am fully aware private sector workers pay twice also but my reply was in response to public sector workers not private. I was merely replying to his comments.

[Tugger]

I don't quite understand the high horse stance taken by the public sector regarding the tax they pay. By and large, this is all ultimately funded by the taxpayer anyway. While there are a few revenue generating sections of the public sector (the Companies Registry, for instance), if there was no private sector there would be hardly any public sector salaries to tax.

 

Really, I don't see why it should be so comfortable in government - the problem is that the people in management have no stake in reducing costs

[BETTYBOO68]

I don't quite understand the high horse stance taken by the public sector regarding the tax they pay. By and large, this is all ultimately funded by the taxpayer anyway. While there are a few revenue generating sections of the public sector (the Companies Registry, for instance), if there was no private sector there would be hardly any public sector salaries to tax.

 

Really, I don't see why it should be so comfortable in government - the problem is that the people in management have no stake in reducing costs

 

no one is taking a high horse stance regarding the tax they pay! we all have to pay taxes and everyone is paying the same percentage depending on earnings, people (private sector) are commenting on paying their taxes to fund public sector pension and our response is we are paying taxes also for their use e.g nhs, police,roads, street lighting, over expensive projects etc. we are all paying for each other through tax at the end of the day through one thing or another.

 

no one is saying it should be comfortable in governement, but government should leave the pension scheme as it is instead of scaremongering with higher taxes and reduce public services.

[Slim]

For me, if the shortfall is because the fun money's been used for capital projects, then it's fine for the taxpayer to bail out the fund.

 

If the shortfall is because of poor performance of the investment, then the taxpayer shouldn't.

 

I accept that final salary schemes are guaranteed, and that the government should get up to date and scrap them quickly because they really don't work and have assumptions about growth and performance that just don't stack up any more.

[manshimajin]

no one is taking a high horse stance regarding the tax they pay! we all have to pay taxes and everyone is paying the same percentage depending on earnings, people (private sector) are commenting on paying their taxes to fund public sector pension and our response is we are paying taxes also for their use e.g nhs, police,roads, street lighting, over expensive projects etc. we are all paying for each other through tax at the end of the day through one thing or another.

 

no one is saying it should be comfortable in governement, but government should leave the pension scheme as it is instead of scaremongering with higher taxes and reduce public services.

Betty I think the point is that we are all paying for public services "nhs, police,roads, street lighting, over expensive projects etc." and we are all paying for the PS pension deficit. We are all benefitting from most of the public services but we are not all benefitting from the deficit subsidy. It is an uncomfortable financial fact that with our current demographics and longer life expectancy the PS pension deficit costs will continue to rise faster than inflation if nothing is done. The value of the funds that pay the benefits will also have fallen significantly due to the drop in shares, property values and interest.

 

Ultimately something has to give as otherwise there will be less and less money to pay for public services - increasing amounts will go to pay for the pension deficit. Clearly this is not a realistic option. How are you going to pay for the deficit if you don't:

• increase contribution rates, or
  
• reduce benefits, or
  
• raise taxes, or
  
• reduce the number of public servants and the levels of service?
  

Whilst it no good to 'cry over spilt milk' both senior Public Servants and the Government should have been managing this situation for the last couple of decades. You (and we non PS workers) are suffering from a reluctance and lack of moral fibre to deal up-front with this issue years ago.

 

We are a long way past the point where we can put our heads in the sand and hope that the issue will go away.

[Pragmatopian]

I accept that final salary schemes are guaranteed, and that the government should get up to date and scrap them quickly because they really don't work and have assumptions about growth and performance that just don't stack up any more.

 

Amen to that. I am staggered that any final salary schemes are still open to new joiners. The scheme at my employer closed more than 10 years ago.

[oldmanxfella]

no one is saying it should be comfortable in governement, but government should leave the pension scheme as it is instead of scaremongering with higher taxes and reduce public services.

 

Scare mongering? Have you actually read any of the detailed information that has been published leading up to and during this pension review? I have and the scheme as it stands is as good as unfunded and to meet all existing liabilities as they fall due (ie, just to pay the pensions of current retirees, and the pensions of all workers now employed by the government when they are expected to retire) will cost IOMG £1bn over the next 50 years or so. That is a staggering amount of money for a tiny island economy with a smallish population (and therefore a finite revenue generating ability). Furthermore a pay as you go system (ie, one that relies on a steady flow of new tax payers to come in so they can pay existing pensions) can only ever have limited application in an island where the population inflow will always be restricted.

 

You must be completely blind if you cannot see that this cannot continue unchecked or unmanaged as the IOM simply does not have the ready cash at its disposal to come good on this.

 

Whilst I sympathise totally with government workers you can't ignore the economic reality that government itself is attempting to be very sensible here in looking at ways of controlling things better as this system is unsustainable if the liabilities are allowed to get bigger, and will put a serious drag on government spending in all other areas of the economy. That is not scaremongering, its an inescapable fact.

 

Edited: spelling

[P.K.]

public sector workers freeloaders? (maybe the high earners or the politicians who are exempt) majority of public sector workers have a good reason to whinge about the proposal of changes in the pension scheme, some people who have paid in for years so they have a lump sum to pay off their mortgage and a little left over are now freting about their future.....

Wake up, wake up, WAKE UP TO REALITY!!!!!

 

In the private sector folks have also paid into their pension for years only to have the scheme change because of "affordability" issues. Why do the public sector employees think they should be ring-fenced from the current financial realities!!!!! I can absolutely guarantee that unless your name is Sir Fred in the private sector the amount of pension you can expect has reduced over the years and has just nose-dived along with the institutions where their pension pot was invested.

 

I'm disgusted that the Public Sector still have a Final Salary Scheme. No-one else can afford one any more so how can the Public Sector? Ahhhh, silly me, they'll just rip the rest of us off.

[ptarmigan]

The Civil Service pension scheme is a non-contributory final pension salary scheme. It's unsustainable. I'm a civil servant and I accept it has to change. I would like my Union to engage in a reasonable debate with my employer to try and manage this change. My Union appears to be trying to rabble rouse - they are also distributing a petition that demands 'no change'; this is totally unrealistic. I think that Angela Moffatt is desperate to make a name for herself and take the civil and public service out on strike - and trump her father.

 

Why should the Island tax payers fund our pensions? I have some sympathy for those public servant who have paid in 6% - but this is still very little compared to the benefits that are gained. We have to accept that we are going to pay more and get less, but that we will still have a vastly better scheme than almost anyone in the private sector. Also better job security, good terms and conditions etc

 

I'm really annoyed though that the MHKs pension scheme isn't included. Their pension accrues at 3 times the rate of civil servants. So an MHK with 10 years under his or her belt will have 30 years worth of pension. Some of them work hard - but not 3 times harder than my colleagues!

[Galen]

At last, a balanced view from Ptarmigan.

 

Re the comments "My Union appears to be trying to rabble rouse - they are also distributing a petition that demands 'no change'; this is totally unrealistic. I think that Angela Moffatt is desperate to make a name for herself and take the civil and public service out on strike - and trump her father." I heard this was one of the reasons the former Chair and Vice Chair left last year - both were reasonable and balanced individuals and had served the union for many years.

 

Nevertheless, public sector pensions are effectively deferred pay. The differences between private and public sector pay has been considerable even before the private sector enhancements e.g. private health and dental care, gym memberships etc are factored in - an "inconvenient truth" in this debate some might say !

[piebaps]

At last, a balanced view from Ptarmigan.

 

Re the comments "My Union appears to be trying to rabble rouse - they are also distributing a petition that demands 'no change'; this is totally unrealistic. I think that Angela Moffatt is desperate to make a name for herself and take the civil and public service out on strike - and trump her father." I heard this was one of the reasons the former Chair and Vice Chair left last year - both were reasonable and balanced individuals and had served the union for many years.

 

Nevertheless, public sector pensions are effectively deferred pay. The differences between private and public sector pay has been considerable even before the private sector enhancements e.g. private health and dental care, gym memberships etc are factored in - an "inconvenient truth" in this debate some might say !

 

And another from Galen.

 

I attended a union briefing and i didn't get the impression that there was an attempt to rabble rouse at all. Sure there were strong words but ultimately any the members will take any decision by way of a ballot and not Ms Moffatt (who is simply an official paid by the members to look after their interests).

 

The Civil Service Union doesn't have no solutions as some other posters have suggested. The Union in fact welcomed some of the changes and definitely told all its members that the economic reality was that change was inevitable. The Union will also be encouraging its members to take part in the consultation exercise and will be assisting its members in filling out the consultation documents to make sure that their views are heard by Hymans Robertson.

 

The UK Official made it clear that consultation was vital however he also made it clear that they would prefer to consult with the organ grinder (Govt) and not the monkey (Hyman Robertson) but this was only in terms of negotiating the detail and not the basic need for change which was not even up for debate.

 

Galen's point about pay comparison is valid too. For many years the govt has been resisting pay claims by the Civil Service Union and has used this comparison as an argument. The govt view has been that when all pay and benefits are taken into account (including the pension) the levels of reward are comparable. A change in the pension arrangements may now open up a gap and create a new pay claim.

 

Finally, there are just under 8500 public sector workers according to the details released at this year's budget. Only around a quarter of those are "civil servants". but you must remember that the term "civil servant" doesn't mean faceless beaurocrat. Included in the grouping are (among others) Prison Officers, Air Traffic Controllers, Vets, Engineers, Harbour Masters and a whole range of others. We don't all pull in six figure salaries and look at ways of making your lives miserable...................That's just the DoT

[piebaps]

 

None of the governments own recent surveys back that up. Allan Bell himself is on record as saying that public sector pay is higher than equivalent private sector pay in many areas. Its a totally false argument.

 

That's not what they're telling us. The Govt have recently produced some "total reward package" comparisons which suggest it's about even stevens. They are using this to resist/reduce any pay claim in this year's pay rounds.

[hboy]

That's not what they're telling us. The Govt have recently produced some "total reward package" comparisons which suggest it's about even stevens. They are using this to resist/reduce any pay claim in this year's pay rounds.

 

Boo hoo to you. There are 90 people potentially losing their jobs at RBSI this month. They are probably not on high wages either and probably couldn't give a flying f**k about cost benefit analaysis or whether they are getting a fair shot at this years pay rounds.

 

Some people are just greedy twats who fail to acknowledge the harsh economic realities of life.

[Pragmatopian]

They are using this to resist/reduce any pay claim in this year's pay rounds.

 

Quite right too. How anyone in the current economic climate can countenance giving discretionary pay increases is a mystery to me. My bonus this year is still (so far) having a job.

 

I was interested (and somewhat depressed) to talk to a South African colleague the other day who had worked in the South African public service. She worked in a vast open plan office building and had to walk the entire length of her floor to get to her desk. When she arrived in the morning at 8am she didn't see a soul. When she arrived at 9am there may be one or two 'managerial' types already at their desks. If she left at 4 another handful of managers may still have been there and when she left after 5 it was a ghost town again.

 

Short of murdering someone, public servants there have pretty strong security of tenure and a heavily unionised workforce who regularly pressed for (and received) across-the-board pay rises above inflation: no such thing as performance-related pay or sacking the 10% of low performers each year. If you managed not to die for a few years, you'd automatically feel entitled to promotion and would probably get it. If you really screwed up, you'd be moved sideways or restructured into another group. Restructuring departments was also the preferred solution if several people became 'entitled' to promotions at the same time - split one group into x groups and divide the junior staff accordingly. Absence due to illness or personal problems was endemic and 'stress' was a favourite reason for regular or prolonged absence, especially during the frequent periods where restructuring was taking place.

 

The example magnifies for me the problems that commonly exist in the public sector (and, to be honest, in the private sector during boom times).