Petition for Pension Reform

[Conor]

For a start, if we're talking about a pre 1995 public servant, the figure is 28,000 (16,000 + 12,000), not 16,000, because that person also gets the state pension.

Are you sure you're very well informed about public sector pensions?

[Conor]

have you any response to bloogy drew?... i've read the blog and i think it demonstrates exactly the inequality in pension provisions between public and private sector workers.

Pretty much everything in that blog is factually incorrect.

[LeftOfCentre]

I simply can not see what your argument is ! ! ! !

Do you want PS workers to be moved to the same system as Private sector workers? .... or do you want the reverse?

You are using terms like ''inequality'' but you are not comparing like with like.
To me it looks like you are looking for yet another way to attack the public sectors pay & conditions.

Private sector pensions can be put into cash, , , this means that you can get 41% relief on your contribution and you are guaranteed it will not fall.,,,to prevent the money not loosing against inflation some people (well most) decided to invest in various risky assets such as property / equities / bonds etc.

Public sector pensions are guaranteed. . . .

Wahts the big deal! . . . i work in the private sector but i chose the company I work for partly because It had a ''defined benefit'' pension scheme (similar to PS). . . . I compromised on salary for this...... & this is simply what the public sector employees have done, however due to poor/lazy/spineless management their salaries have gotten a little out of kilter, this needs to be fixed...... But I dont see it as a pension reform issue,,,, its a salary reform issue.

[johnm]

Pretty much everything in that blog is factually incorrect.

care to elaborate?

[Conor]

care to elaborate?

See my post above, for one thing.

also, look at this:

Defined Contribution Less and Less Valuable the longer the pensioner lives

One important point that this also demonstrates is that a defined contribution pension becomes less and less valuable as life expectency continuously increases. As people live longer, which is and must always be a cause for celebration, their occupational pension fund must be stretched over more years. So, if the person lives to be 90, which is currently well within the realms of reason, and will soon be the norm rather than the exception, their annual pension becomes:

12K + (128,000/(90-66)) =
12k + 5120= 17,120k per annum

Again, if the person lives to be 100, their fund is stretched further, and their annual pension becomes

12K + (128,000/(100-66)) =
12k + 3657k = 15,657k per annum

Not only are we punishing our citizens, and forcing them to have a lower quality of life, for living longer, we are asking them to predict how long they will live to make the best possible use of their pension fund. This is clearly both unfair and unrealistic, and dont forget the figures above are based on the presumption that the employee had an occupational pension at all, over 50% of private sector employees do not.

He isn't talking about a pension at all. He's talking about a big lump of cash.

[bloggydew]

Are you sure you're very well informed about public sector pensions?

As i said on the blog, everything in it is based on information i've read elsewhere.

On the point of the pre1995 public servant also getting the state pension, (16k + 12k), the source for that is the irish times.

"The pension scheme is even more generous for those who joined the public service prior to 1995. They may collect a public service pension as well as the State pension."

Are you saying thats not the case?

On the point of the "lump of cash"... it states here that

"You are no longer obliged to purchase an annuity and are now able to choose between purchasing an annuity or placing the accumulated fund in an "approved retirement fund" (ARF) or having the accumulated fund paid to you"

So yes, I take your point that I shouldnt assume that the person decides not to purchase an annuity (and i will update the blog to take that into account, because yes that is an omission). Is it not the case that someone retiring now would avoid purchasing an annuity in the current market?

On the points LeftOfCentre made...

I'm saying that everyone should have the same pension rights, regardless of what sector they work in, whether thats DB or DC. I dont think it should be a race to the bottom.

You are extremely lucky to have DB in the private sector. But the vast majority of private companies no longer make that option available to employees.

[bloggydew]

I realise now that on retirement employees are still obliged to purchase an annuity. The link I quoted previously was for self employed only.

But the principle is still the same, occupational pension fund/(life expectancy-retirement age) + interest = annuity.

[Ronanr]

Bloggydew, pre-1995 civil servants are not entitled to any contributary pension, I am pretty certain of that. (By the way, your link to the Irish Times, your source for the info, does not work. Are you sure you did not read in in one of John Waters opinion columns? They are not fact-checked, you know.)

Like Conor says, i think most of your blog on this issue is nonsense.

I take no pleasure in saying that, but it seems to be the brutal truth.

For instance, you do not take into account at all in your calculations the accumulated interest a DC pension would accrue.

[LeftOfCentre]

On the points LeftOfCentre made...

I'm saying that everyone should have the same pension rights, regardless of what sector they work in, whether thats DB or DC. I dont think it should be a race to the bottom.

As a proud lefty, , , , i respect that you think everyone ''should'' have the same rights ,,,, so i take it you are arguing that DB schemes be scrapped for all???? And those that save the most (into their pension)... get the most?

You are extremely lucky to have DB in the private sector. But the vast majority of private companies no longer make that option available to employees.

I'm not that lucky ,,,, its part of the terms & conditions I was offered in exchange for my expertise ..... just like salary.

I still can not work out what exactly your argument is ,,,,, but it seems the thrust of it is to reduce public sectors t&c's??? If thats your argument, just come out & say it!

[talkies]

There should be a universal state pension with all workers contributing an equal percentage of their income, with allowances for low-paid workers/those on minimum wage.

All should get the same percentage of their salary or a minimum payment, whichever is the higher amount.

Those who can afford to risk extra money on private pension schemes could do so.