Claims that a quarter of council tax is going on gold-plated council pensions

Replies to This Discussion

Permalink Reply by John McMullan on July 21, 2010 at 20:15

Here, come and work for me for 20 years. I know you could earn more elsewhere but to make up for it I'll give you this "gold plated" pension when you retire.

10 years go by.

I'm really sorry but you can't have that "gold plated" pension because we expected to finance it out of soaring council tax revenue. Oops.

Permalink Reply by Ed Crane on July 21, 2010 at 22:55

I am getting as sick of the vogueish 'gold-plated' as the myriad other media-inspired clichés that suddenly become part of everyone's received wisdom these days.

Permalink Reply by John McMullan on July 21, 2010 at 23:15

Alan Stanton laid out the facts about local government pension schemes here.

Permalink Reply by Gordon Keenan on July 22, 2010 at 0:24

Its sad when Tory rags like the Mail can just print their anti-public sector diatribe without having to make honest critical comparisons with the pension arrangements for police, Sandhurst trained army officers, Bankers working for banks which have been bailed out by the state & are effectively nationalised, private companies who receive over 50% of their income from the public purse etc and even the self appointed private bloody managers of our Pension funds . If we are going to make comparisons lets look across the entire landscape of public expenditure !
That having been said and having read Alan Stainton's previous very uninspiring defence of public service pensions I am an ex local Govt officer who does not believe that Final salary pensions can be justified. Pensions should be based on your average salary - which would not have so much impact on low waged staff but would have an impact, correctly, on these senior officers who towards the end of their careers always appear to take enormous leaps in pay as they skip from Head of to Asst Director to Director etc and end up with enormous pensions sums which are not reflective of their working life contributions. We do have to recognise the unjustifiable imbalances in our system which local residents cant be asked to bail out.
In my humble opinion no local govt scheme should be allowed to exceed the average employer pension contribution of all UK employers. A little painful at first but it would eventually have us all singing from the same songsheet and realising that the public & private sectors are inherently linked !
Just a few thoughts.
Cheers
GK

Permalink Reply by Michael Anderson on July 22, 2010 at 7:39

Well, I certainly hope I'll be in the position to take this huge leap in salary before I retire but it looks doubtful.

Where I work there are 8,000 employees and 8 directors. So that makes my chances of retiring on a "gold plated" pension 1/1000 (oh, and the great majority of these employees earn way below £22k giving them a pension of under £7k per year).

Are we a bit in danger of depriving the majority of the rather pathic pensions they have earned just to deal with the huge pensions of 8 people?

Permalink Reply by Gordon Keenan on July 22, 2010 at 21:14

The answer is simple Michael - No we are not , as i said previously do the Maths if someone working in local public service on as low wages as you say goes on receive an average payment
then the difference to that binman or cleaner or park warden will with respect be marginal. The difference will be in the much larger final salaries negotiaited & paid to those from Head of and above. And better to have a pension fund that has enough money to pay out on properly managed terms than one that was borne out of false promises and either goes burst or results in 10's of 1000ps of these same local workers caste out of work !
24% employer contributions by local authorities paid for by the rest of the Tottenham disengaged and financially hard pressed is not justifiable and is not socially equitable. We need to think about what we are trying to create.
I have lots of other issues with Public pension funds and how they are administered but I'll quit there. GK

Permalink Reply by Alan Stanton on July 22, 2010 at 9:27

Gordon, I wasn't defending, justifying, or aiming to inspire. Just trying dispassionately to contribute some factual content to the discussion.

As Ed Crane points out, endless repetition of the same misleading clichés doesn't make them true. But of course, the fact that something is reported in the Daily Mail doesn't automatically mean it's untrue.

What saddens me is that people who seem thoughtful and intelligent can also be so incurious; unwilling ask questions and check facts.

Permalink Reply by Gordon Keenan on July 22, 2010 at 21:31

Fairplay Alan, i was just on a wee Scottish rant.
I don't like the way public pension funds are administered and unfinanced promises batted into the future with no-one working out the sums which then come back to haunt us and enable the Daily Mail bums to castigate public service in general.
We are in agreement on most things and I'd definitely commend everyone to visit that Dan & Dan link you're link sent me to on YouTube http://www.youtube.com/watch?v=7gi4EVRpyds .
That song should get to No.1 in all charts even the top Pension Funds.
Cheers
GK

Permalink Reply by Alan Stanton on July 23, 2010 at 9:37

My favourite bit is the last two lines of 'dialogue'.

Permalink Reply by Clive Carter on July 22, 2010 at 23:48

Alan according to the DM article, the average proportion (of council tax spent on pensions) in the south east is even higher than the country as a whole. Instead of 25% nationally, its 28% in our corner (by my calculator).

If this is true, then my question is (a) is this sustainable and (b) is this fair on society as a whole?

Thoughtful. Curious.

Permalink Reply by Michael Anderson on July 23, 2010 at 8:07

Where do you think private sector pension payments come from - thin air? They come from our pockets too - from the money we spend in Tesco or filling your car with petrol etc. No one seems to find it wrong that these pension are funded from our money yet it seems the reverse when it comes to the public sector.

a - yes
b - yes

Permalink Reply by Clive Carter on July 23, 2010 at 8:27

Michael, I think you are confusing pensions with the level of pension payments. Council tax is compulsory. When we freely contract to buy goods and services we have a choice where we spend, what we spend it on and how much we spend.

The "pensions" element of these purchases is surely going to be small: the pensions element of a full tank of petrol for my motorcycle is going to be small, far less than 28%. And also tiny in absolute terms.

The private sector is under constant competitive pressure to ensure that it turns a profit and so that the pensions are sustainable. But I hold no brief for the private pensions industry.

It wiill come as a surprise I think to many that the pensions element of council tax might be as high as 28%. I think you overlook that council tax is a tax. Not only is there no choice about it, there's little control over how it is spent and misspent on our behalves.

If you genuinely believe that possibly 28% of council tax going on pensions is sustainable, is there any proportion of our council taxes going towards pensions that you think might be unsustainable, too high and unfair?

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