Quote:
Originally Posted by Pierre
Why should you get a reduction? you should be paying more.
As I once demonstrated to you in another thread, I'll do the calculation again
A constables pay after 10years service is around £36,500 not including overtime or other allowances.
if we use that figure.
11% of that = £4015.
x 30 years = £120,450.
If you have 30 years service you are entitled to 2/3rd your final salary per annum which would be: £24,300 per annum.
Now if the constable joined aged 20, and retired at 50 and lived a healthy happy life to around say 80? not unreasonable.
His total pension payout would be: £730,000.
Minus his massive 11% contribution of £120,450 = tax payer liability of £609,550. approx 5x your contributions.
So don't come to me with the "hard done to" on the pension front.
I'm willing to cut the police and fire service a little slack for the reasons you point out.
But the bottom line is the taxpayer is underwriting public sector pensions and it's just not sustainable, while the rest of us rely on the stockmarket.
There needs to be reform.
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You have to remember that the public sector provide a public service, of which many are essential, and in many cases dangerous. And for this they are paid a lower wage than the private sector equivalent, as an average over their career.
Now before anyone starts shouting, I know that in the present economic climate many private sector wages are closer (if not lower in some cases). But when the economy is in a better state, then it is the private sector that benefits with bigger pay rises, and bonuses, etc... This is not the case in the public sector. So I bet none those who will reap the benefits when we are out of the recession will be complaining then.
Now if you want to pay 14% of your pay into a pension, then go ahead and do it, and then you will get a far better return also. But police and firefighters didn't have any choice.
---------- Post added at 19:16 ---------- Previous post was at 19:12 ----------
Quote:
Originally Posted by Traduk
Your last paragraph appears to clearly demonstrate that you have not grasped the concept at all.
To simplify the concept and to put it into a Virgin Media employee's viewpoint..... if your employer was legally able to retain your contribution and retain theirs and use both for day to day expenses on a promise that you will get a good pension at the end (maybe) would you be happy if they realised that their model was deeply flawed and tried to give you three parts of not a lot. That is what the various governments over the past few decades have done and thus the problems ahead.
Quoting stock market performance over the past four years is ludicrous. Pensions are built up over a working lifetime and any performance has to be measured over that duration. Looking back is not much of an assurance in looking forward but one thing is a certainty.
That certainty is that inflation, interest rates and investment performance is dynamic. 30+ years ago when interest rates were hitting 20% nobody would have predicted today's rates but 30+ years before that nobody would have predicted 20%.
IMO people who allow their long term pension prospects to be diluted are allowing the government to respond to a short term flat line interest rates and will pay massively long after the current bunch of idiots have retired to their country mansions to enjoy the fruits of their inherited wealth no doubt bolstered by lucrative deals.
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