Government to take a two year 'pension holiday': SBP

[cyberianpan]

There is also the basic math to contend with.

A loan will cost anything between 5% and 8% per annum.

really, that's what government bonds yield now ?

You will actally save money by not borrowing and stop buying shares for about 2 years.

That's actually what they're not doing(saving) ... putting aside money for pensions is vital .... the government have decided to take advantage of the normal person's ignorance on financial markets and risk. So they're going to eliminate pensions provisions.

What they ought to do is say cut 5% across the board, that would require real political balls, eliminating all of pensions provisions is just a 3 card trick. But I guess Joe Soap is an idiot, he fell for the 3 card trick in 1977 also.

cYp

[eurocrat]

]

Funding Metro North is not the problem.
The cost-benefits of this project are likely to be very poor, not that that ever stopped FF wasting our money.

Now if you want a worthwhile infrastructure project, go for the rail interconnector - especially as part of the Guiness brewerey will be redeveloped.

I agree. I was using Metro North for illustrative purposes. (I did say for example).

But the point still stands. It may be more prudent and smarter at this junction to invest in some infrastructural projects (for example the Interconnecter ) than to put it into NPRF.

[droghedasouth]

]

Funding Metro North is not the problem.
The cost-benefits of this project are likely to be very poor, not that that ever stopped FF wasting our money.

Now if you want a worthwhile infrastructure project, go for the rail interconnector - especially as part of the Guiness brewerey will be redeveloped.

I agree. I was using Metro North for illustrative purposes. (I did say for example).

But the point still stands. It may be more prudent and smarter at this junction to invest in some infrastructural projects (for example the Interconnecter ) than to put it into NPRF.

There is no reason to stop investing in the Pension reserve.
The same considerations apply to private individuals and is the government seriously saying we should also take a pension holiday?

Even if we have to borrow, the loans do not count against our 3% of GDP limit.
Given the government can borrow at the lowest possible rate, albeit not as low as before the Lisbon referendum because of increased political risk, stopping putting money into the Pension reserve is just what you would expect a barrister and a solicitor to think was prudent eceonomic management.

[eurocrat]

There is no reason to stop investing in the Pension reserve.
The same considerations apply to private individuals and is the government seriously saying we should also take a pension holiday?

Even if we have to borrow, the loans do not count against our 3% of GDP limit.
Given the government can borrow at the lowest possible rate, albeit not as low as before the Lisbon referendum because of increased political risk, stopping putting money into the Pension reserve is just what you would expect a barrister and a solicitor to think was prudent eceonomic management.

But which would you rather: investment in infrastructure or investment in the NPRF? We don't have the luxury of having both anymore.

[cyberianpan]

There is no reason to stop investing in the Pension reserve.
The same considerations apply to private individuals and is the government seriously saying we should also take a pension holiday?

Even if we have to borrow, the loans do not count against our 3% of GDP limit.
Given the government can borrow at the lowest possible rate, albeit not as low as before the Lisbon referendum because of increased political risk, stopping putting money into the Pension reserve is just what you would expect a barrister and a solicitor to think was prudent eceonomic management.

But which would you rather: investment in infrastructure or investment in the NPRF? We don't have the luxury of having both anymore.

That is the false argument that others are peddling !

We need cuts across the board, current spending went out of control during the boom, it must be tackled.
cYp

[eurocrat]

That is the false argument that others are peddling !

We need cuts across the board, current spending went out of control during the boom, it must be tackled.
cYp

You know that cut in current spending are unlikely and possibly not desirable. For example we could hardly cut back on the number of teachers of nurse at the moment. Cuts in the Civil Service wage bill will not come any where near to plug the medium term hole in the Finances.

Every euro spent in one area has an opportunity cost in other area. In that sense it certainly is not a false argument. In this case I believe it is sensible to prioritize infrastructural projects ahead of investment in the Pensions Reserve Fund.

[cyberianpan]

That is the false argument that others are peddling !

We need cuts across the board, current spending went out of control during the boom, it must be tackled.
cYp

You know that cut in current spending are unlikely and possibly not desirable. For example we could hardly cut back on the number of teachers of nurse at the moment. Cuts in the Civil Service wage bill will not come any where near to plug the medium term hole in the Finances.

Every euro spent in one area has an opportunity cost in other area. In that sense it certainly is not a false argument. In this case I believe it is sensible to prioritize infrastructural projects ahead of investment in the Pensions Reserve Fund.

Stop replacing some of those who retire.

Our social welfare rates are now amongst the highest in the world.

The problem is in current spending, if it takes us years to realise that it will be a very costly lesson.

cYp

[eurocrat]

Stop replacing some of those who retire.

So that talented young graduates could not enter the Civil Service? Not sure thats a great idea.

In any case do have any idea how much that would save?

Our social welfare rates are now amongst the highest in the world.

Do you have a link to prove this?

[cyberianpan]

Stop replacing some of those who retire.

So that talented young graduates could not enter the Civil Service? Not sure thats a great idea.

Might be be no harm if for a few years graduates gain experience in the productive sector.

In any case do have any idea how much that would save?

Our social welfare rates are now amongst the highest in the world.

Do you have a link to prove this?

Irish Times, Friday, July 25, 2008
[size=7]Curbing public spending growth is the only option[/size]

As shown in Table 1, annual spending on social welfare has risen from €6.7 billion in 2000 to a projected €16.9 billion in 2008, an increase of more than €10 billion or 154 per cent over the eight-year span.

This increase has financed very generous additions to social welfare benefits. Thus, the personal rate for the contributory old age pension has climbed from €121.89 in 2000 to €223 today. Similarly, over the same period, monthly child benefit rates have risen from €53.96 to €166.

Commenting on these trends, an internal Department of Finance memorandum noted: "Irish social welfare payment rates are now far in excess of their UK equivalents: our State pension (contributory) is 94 per cent higher than the UK; jobseekers' benefit is 160 per cent higher; and child benefit rates are 60 per cent higher. Conversely, Irish PRSI rates to help fund these higher rates are significantly lower than in the UK."

Similarly, the annual cost of the public service pay and pensions bill has risen by €10.5 billion or 118 per cent since 2000, increasing from €8.9 billion to €19.4 billion in the process. The addition to the pay bill reflects two factors: increased rates of pay for public servants; and a very large addition to the numbers working in the public sector.

As shown in Table 1, between 2000 and 2007, the numbers working in the public sector have grown by almost one-third, increasing from 233,298 to 308,811.

Current spending needs to be tackled, cutting pensions provisions and an 80% increase in pension payments (with an increasing number of recipients) is recipe for total disaster.

cYp

[eurocrat]

That just shows that some payments are higher than the UK, What about the rest of the EU?