The 2010 Emergency Budget thread

[Guest sibon]

What would be done with it if it were a private sector pension?

 

It would be placed in the trousers of the nearest banker invested in some highly lucrative funds to aim for capital growth.

 

In truth, neither method is a great way of planning for old age. As we are all finding out.

 

I thought that my second question was more interesting.

[andyofborg]

 

And another one:

 

What would be the economic effect of all current public sector workers transferring their pension funds to the private sector?

 

existing pensioners wouldn't be able to transfer to the private sector.

 

if current workers were to transfer then there are three sub-questions:

 

a) would they be transferring accrued rights?

if they were then the government would have to kick start their pension fund with sufficient money to guarentee a pension based on those rights and probably give a guarentee to make up any shortfall.

 

if not then the government, would still have to pay the pension up to the point of transfer, though the total liability over time could be accurately estimated and the necessary money budgeted for.

 

b)pension going forward?

this would be based on the yield of the pension contributions made by each individual and presumably some made by the employer

 

c)would a person close to retirement be forced to transfer?

someone within a few years of retirement would not have the time to build up a sufficient pension fun to make transferring out worthwhile

[Guest sibon]

existing pensioners wouldn't be able to transfer to the private sector.

 

if current workers were to transfer then there are three sub-questions:

 

a) would they be transferring accrued rights?

if they were then the government would have to kick start their pension fund with sufficient money to guarentee a pension based on those rights and probably give a guarentee to make up any shortfall.

 

if not then the government, would still have to pay the pension up to the point of transfer, though the total liability over time could be accurately estimated and the necessary money budgeted for.

 

b)pension going forward?

this would be based on the yield of the pension contributions made by each individual and presumably some made by the employer

 

c)would a person close to retirement be forced to transfer?

someone within a few years of retirement would not have the time to build up a sufficient pension fun to make transferring out worthwhile

 

There is a fourth question:

 

Who would pay the pensions of all of the existing public sector pensioners?

 

And a fifth:

 

Who will fund the transfer of the pension funds already accrued?

 

The money is already spent, you see.

 

In any case, it looks like the problem isn't as bad as we had thought. We're just being softened up again.

[andyofborg]

There is a fourth question:

 

Who would pay the pensions of all of the existing public sector pensioners?

 

And a fifth:

 

Who will fund the transfer of the pension funds already accrued?

 

The money is already spent, you see.

 

In any case, it looks like the problem isn't as bad as we had thought. We're just being softened up again.

 

that was really my point, existing pensioners and those close to retirement will still have to be funded by the government one way or another.

 

transferring the other pensions to a third party only really saves pensions accrued from the date of transfer onwards, anything accrued before the transfer will be the governments problem.

 

at the end of the day, the public sector is going to shrink, and if your not a doctor, nurse or policeman you probably won't get much support from the general public when the cuts do come.

 

one way or another we, the average working man, pays the public sector wage bill and we won't tolerate a lot of whining about how terrible your lot is. we already know, we've been through it and we, more or less, survived.

[Guest sibon]

t

one way or another we, the average working man, pays the public sector wage bill and we won't tolerate a lot of whining about how terrible your lot is. we already know, we've been through it and we, more or less, survived.

 

That is an interesting choice of words.

 

Do you not think that most public sector workers are also "average working men" (and women ).

 

It would be interesting to see how the private sector coped in an anarchistic, poorly educated, ill society with a crumbling infrastructure.

[Tony]

... and how would the public sector manage without any wages?

 

A balance is needed

[andyofborg]

That is an interesting choice of words.

 

Do you not think that most public sector workers are also "average working men" (and women ).

 

It would be interesting to see how the private sector coped in an anarchistic, poorly educated, ill society with a crumbling infrastructure.

 

the private sector coped before we had a public sector.....

 

it was perhaps a poor choice of words, but the point that public sector wages are paid by private sector workers is quite valid. the private sector workforce has been through the downsizing/no-pay-rise machine and grinned and born it. if the public sector worker is an "average working person" then its time for them to do the same.

[Guest sibon]

... and how would the public sector manage without any wages?

 

A balance is needed

 

Very true Tony.

 

I'm grateful for your contribution to my salary and I'm sure that you are grateful for the constant supply of scientists and engineers that I help to bring about.

 

I just don't get this public sector is evil hysteria that we are being sold at the moment. Things are bad, but they have been worse and they will get better. It is a time for calm heads.

 

A balance between chopping out the undoubted waste in the public sector, improving tax revenues and stimulating economic growth is required. I have as important a part to play in the latter as you.

 

Now, do you know a decent washing machine repair man?

[Rupert_Baehr]

...Public Sector pension contributions go to the Treasury to be invested in public expenditure, including subsidies for your private sector pensions. It is perfectly sensible that they do so, it makes direct use of the contributions for the immediate good of the country.

 

How about this for a 'cunning scheme scam'?

 

You send me £30 a week, every week for 40 years, pass this e-mail on to 20 other people and get them to do the same. I will pay you and them £150 a week every week after you (and they) are 65. (They should also each send the letter on to 20 other people.)

 

I will use the money for my immediate good.

 

Whatever you do DON'T BREAK THE CHAIN. If you do, the tooth fairy will come along and pull all your teeth out.

 

Try a trick like that and you'll probably do time ... unless, of course, you're the government. The chain may well break - either because people live for too long or because some people take out money early or because some people take out money without putting any in.

 

If you're the government nobody will come after you - if you're lucky, you'll be long gone before the chickens come home to roost. It will be somebody else's problem.

[Guest sibon]

the private sector coped before we had a public sector.....

 

it was perhaps a poor choice of words, but the point that public sector wages are paid by private sector workers is quite valid. the private sector workforce has been through the downsizing/no-pay-rise machine and grinned and born it. if the public sector worker is an "average working person" then its time for them to do the same.

 

I haven't seen much in the way of complaint about the two year public sector pay freeze. It seems reasonable enough to me.

 

Don't forget that private sector wages are also partly paid by public sector workers. Go and ask the nice man who served me in Richer Sounds this morning, if you don't believe me.

 

I do wonder whether we will get to share in the spoils of the good times though.