[Closed] All those wingeing about public sector workers and pensions

Ernie wrote - They are the paper for 'after dinner activists' who prefer to waffle than do anything.

I wonder how many public sector STW'ers on strike will be posting on here on strike day?...

I wonder how many public sector STW'ers on strike will be posting on here on strike day?..

What's that got to do with anything?

Hora likes to concern himself with the more pressing problems which everyone else ignores.

If the budget deficit is such a serious problem, then why is the basic rate of income tax still lower than it was during the boom years ?

OK, maybe there was a argument back in the boom years which said that the UK could afford to lower the basic rate to 20%, although I would dispute it, but surely there is no justification whatsoever to keep it at that when the deficit is so high ?

Britain today has a basic tax rate considerably lower than it was during the Thatcher years, and people wonder why the government is skint ? .....where do they expect the money to come from ffs ?

You can't have services without paying for them.

You could also reduce the deficit by getting people back to work. If Britain can't afford a one day token strike by public sector workers, then it certainly can't afford to have 2.7 million people unemployed every day.

You could further reduce the deficit by nationalising the utilities and using their vast profits.

Of course I fully realise that those suggestions are ideologically unpalatable for the government, but that is the only reason why they are not implemented. And the only reason why the government persists with their attacks on public sector workers.

Ernie - I'm assuming you lean towards the left politically? Why are you advocating a rise in taxation for the people who earn the least?

The economy is screwed because there is too much public and private debt, and the resultant deleveraging is squeezing disposable incomes. Do you really think raising the basic rate of tax will solve that?

Everyone knows you have to pay taxes to get public services - can't you at least recognise the viewpoint that a decent proportion of the taxpaying population thinks they are paying too much for too little? Even worse, they feel like they are paying through their noses not just for services, but to keep public sector employees more comfortable in retirement than they will be!

I also love your proposal that the 2.7m unemployed should be placed in work to reduce the deficit...perhaps some public sector jobs could be created?

kimbers - Member

jota180 you missed out 1 group there

MPs final salary scheme.....

Taxpayer........Employee
28% ..............11.9, 7.9 or 5.9%

my point wasnt that you had been lax in your research its simply that MPs get at least 10% more taxpayer contribution than any other public sector worker, not to mention their benefits scheme ....

Even worse, they feel like they are paying through their noses not just for services, but to keep public sector employees more comfortable in retirement than they will be!

dave and the right wing press thanks you for getting on message and not wanting better conditions for yourself but worse/equally bad conditions for others ...WELL DONE

You've reached the final stage - accusations of false consciousness...

Do you think it is conceivable that every working person in the UK economy could have the same entitlements as those in the public sector? How would we fund this? I don't need a costed proposal, just a basic idea so I can tell George Osborne.

Ernie - I'm assuming you lean towards the left politically?

Ever so slightly.

my point wasnt that you had been lax in your research its simply that MPs get at least 10% more taxpayer contribution than any other public sector worker, not to mention their benefits scheme ....

And my point is I can't find a list of figures from somewhere I can trust not to put a spin on it - hence the question and the attached jpg

Are those number correct? or spun - I accept that other numbers may well of been omitted from that table of given a confrontational column heading

The economy is screwed because there is too much public and private debt, and the resultant deleveraging is squeezing disposable incomes. Do you really think raising the basic rate of tax will solve that?

Under the proposed pension changes, my take home pay will be reduced by 5%. That's money I'll not be spending on stuff. Is this a good time to be reducing the spending power of public sector workers?

Is this a good time to be reducing the spending power of public sector workers?

I'd say so. They'll only go spanking it on organic veg and hemp clothing

They'll only go spanking it on organic veg and hemp clothing

Our local mung bean supplier is really struggling.

Why are you advocating a rise in taxation for the people who earn the least?

A rise in the basic rate of tax will affect everyone, and those who earn more will end up paying the most, albeit there will be cap. If you think about it is the fairest way of increasing the tax take because it really will impact just about everyone and in a propoortional way; those that earn the most will pay the most. It also gets round the rather small minded of attitute of "raise taxes for group X because I don't belong to group X"

I'm not going to read all of this thread (no time at the moment althoguh I read most of the previous one ref pensions) but it seems a real shame that most people on this thread are genuine working people, be they public or private. The reality and truth is that most of are being shafted by those in the upper echelons of society. The only people profiting out of the current turmoil are the politicians and thier buddys, the party that happens to be in power doesn't make much difference, especially in todays modern society. I don't know the best cure for our ills but if all of us, whether we are being shafted by the government or our private employers could find some common harmony and work together only then do we have any chance of ridding society of the giant leeches that are sucking us dry whilst gorging themselves on our toils.

I am not allowed to strike or even talk about striking in my job and I already pay more than pretty much anyone into my pension (12 percent), is this fair? To top it off I have also had a day off cancelled so that everyone else can have a voice next week and strike!

Trevor.

Increase the basic rate of income tax, while also increasing the tax free allowance, and reduce VAT.

Instant economy boost.

P.S I work in the private sector in sales, I do a fairly meaningless job in society compared to some yet earn more than many nurses teachers etc making a far more positive contribution to society than me. And my pension is total ****

miketually - Member
Increase the basic rate of income tax, while also increasing the tax free allowance, and reduce VAT.

Instant economy boost.

Hang on a cotton-picking minute there sunshine. Won't that help the poorest the most? We can't be having that!

Increase the basic rate of income tax, while also increasing the tax free allowance, and reduce VAT.

Absolutely spot on.

VAT is what hammers those who can least afford. And it spares no one - pensioners, the unemployed, low wage earners, are all hit with equal vigour.

[img] [/img]

Increase the basic rate of income tax, while also increasing the tax free allowance, and reduce VAT.

Instant economy boost.

I wholeheartedly agree with the raising of the tax free allowance - if it will take a meaningful proportion of the lower paid out of tax altogether. I also agree VAT is regressive and hits the poorest hardest.

Hang on a cotton-picking minute there sunshine. Won't that help the poorest the most? We can't be having that!

Amusingly enough CaptJon, if you'd read the Tullet Prebon paper I linked earlier (and its subsequent chapters) you'd have realised that the author you thought was an evil banker was actually advocating exactly what you agree with.

Most rational people know that to stimulate the economy the poorer sections of society need to be given more disposable income. The poor spend on things, the rich just invest.

There needs to be a redistribution from rich to poor for partly these reasons. There also needs to be a redistribution from the public sector to the productive private sector.

Berm Bandit - Member

"Very difficult to renegotiate contracts that have alraedy been signed"

PMSL : Apparently it isn't, apparently CallmeDave and the lads can do it at the drop of a hat when it suits them. Haven't you understood any of what this is about????

I LOL'd

There also needs to be a redistribution from the public sector to the productive private sector.

You want the government to divert public sector money into the private sector ?

I think you'll find that the neo-liberals don't like that, it's called government intervention, and apparently 'the market' [i]always[/i] knows best. Except when it comes to the railways, and the banks, and training, and nuclear energy, and affordable housing, and agriculture, and manufacturing, and infrastructure projects, and services, and education, and healthcare, and research, but other than that, the private sector has everything more or less buttoned up.

Still arguing about this? I thought it had all been said.

Nice work from the taggers - you must be really proud of yourselves. Is that how poor your argument is? Am I really that worthy a target?

Increase the basic rate of income tax, while also increasing the tax free allowance, and reduce VAT.
"Absolutely spot on."

There also needs to be a redistribution from the public sector to the productive private sector.

Hasn't there already been a pretty huge redistribution into the "productive" private sector banks. Tens of billions wasn't it? How much more do you think they need then?
And how much of a profit did the taxpayer make on the sale Northern Rock?

You won't find me defending that, except I will point out that the taxpayer made less of a loss on Northern Rock than most sane people expected (Branson overpaid). Not the point under discussion anyway as the private sector does not equal (solely) the banking sector, and do I really need to point out the truism that there is no public sector without a private sector to support it?

You want the government to divert public sector money into the private sector ?

I think you'll find that the neo-liberals don't like that, it's called government intervention, and apparently 'the market' always knows best. Except when it comes to the railways, and the banks, and training, and nuclear energy, and affordable housing, and agriculture, and manufacturing, and infrastructure projects, and services, and education, and healthcare, and research, but other than that, the private sector has everything more or less buttoned up.

Neo liberal! I don't even know what that means anymore. No-one is arguing that the role of the state be abolished - I entirely agree that there are public goods which require a public sector (I'd be very happy to see government spending on truly productive assets such as a new airport in the SE). It is instead a question of degree, does the public sector need to be as big as it is now?

As to diversion, if people aren't paying taxes to support a bloated public sector, they have more disposable income with which to invest, or spend as they see fit. I'm not sure you can reasonably argue that the current ratio of the public to private sector in the UK is desirable, or indeed sustainable, and pensions are all part of that problem.

bainbrge

Our public sector is smaller than Germany and France and ours includes the health service - theirs does not mainly.

The problem is we are under taxed and the taxation is not progressive enough.

want decent public services that are taken for granted accross the EU then we need to pay the taxes for it.

Remember when you lok at the raw figures most of our healthcare is included, most of Germanys is not

Most rational people know that to stimulate the economy the poorer sections of society need to be given more disposable income. The poor spend on things, the rich just invest.

That is a very interesting (???) observation. We have just had an economic mirage based on consumption and leverage. I would be amazed if merely stimulating consumption was the answer.

Given the predominance of Keynsians on this forum - we have AD = Consumption + Investment+Government spending + ( exports - imports). Of these the path, to sustainable growth needs to be Investment. Consumption is merely the sugar rush, government spending is constrained so that leaves I plus stimulating X's (via QE leading to a weaker £).

But the economic mirage was based on excess leverage at the household, corporate, bank and sovereign level. Corporates have arguably made the most progress but households, banks and sovereigns remain over-leveraged and their fortunes are completely intertwined. So any idea that there is a quick solution to this mess, is absurd.

There needs to be a redistribution from rich to poor for partly these reasons

Sorry, this seems to be absurd. There is an argument for redistribition based on equality, but the logic here ie, poor people spend, rich invest, leaves me gobsmacked.

There also needs to be a redistribution from the public sector to the productive private sector.

True - but there will be a lag in the short term. The private sector will not respond quickly enough to counter to reduction in public sector employment. Hence, the rocky road ahead and the fallacy of thinking that consumption will be our saviour.

The problem is we are under taxed

Perhaps the most absurd comment of the week/thread

and the taxation is not progressive enough

Better to say we are not taxed [b]correctly[/b]

if people aren't paying taxes to support a bloated public sector, they have more disposable income with which to invest

There you go, with the old myth that taxes don't contribute to the wealth of the nation. Functioning railways help to make Britain wealthier, training and eduction helps to make Britain wealthier, grants and subsidies for manufacturing businesses helps to make Britain wealthier, investment in research helps to make Britain wealthier, road construction helps to make Britain wealthier, and so on - even keeping people healthy, helps to make Britain wealthy.

But people like you who talk about "the bloated public sector" would prefer to pretend that every pound paid in tax is a pound lost.

And if you are [i]that[/i] bothered about taxation affecting people's "disposable income", then why aren't you arguing in favour of other means for the government to receive revenue ? The public sector is perfectly capable of generating its own profits, if it is allowed to do so. EDF makes a nice tidy sum for the government. Unfortunately, it's not our government, which is why I have already suggested nationalising the utilities.

I will point out that the taxpayer made less of a loss on Northern Rock than most sane people expected

Whilst I can't give a cast-iron guarantee with regards to my sanity, I can assure you that I never expected the taxpayer to lose [b][i]any money at all[/i][/b] propping up a bank. Are you seriously suggesting that we should rejoice in the knowledge that the taxpayer made a less an expected loss propping up an industry who's history is the history of unrelenting obscene mind-boggling profits ? I think you need to check [i]your[/i] sanity out mate 🙂

Ernie - tax is a withdrawal from the economy. Government spending is the injection. So the debate is the balance between the two. Fine to use to tax to support G, if and only if G is the most effective and efficient manner of deliver ie, in the case of some public goods and where markets fail.

As the BBC program illustrated this week with comments from both Lab and Tory ministers, the key challenge with G is ensuring that it does not take on a momentum of its own.

[Damn, I had made it to 17:20 on a Friday and managed not to get involved in STW econ/political debate. Going cold turkey was just too difficult. C'mon effort, man!!!]

Still haven't answered my question though TJ...

We could save a bloody fortune if people educated their own kids, looked after their own relatives when ill, old or infirm, sorted their own bins, maintained the stretch of road outside their own house, stopped wasting doctors time with a cold, stopped turning up at A and E Monday morning cos they don't want to go to work, tolerated many minor ailments and infirmaties our ancestors had to rather than expecting increased levels of care etc.

Fine to use to tax to support G, if and only if G is the most effective and efficient manner of deliver ie, in the case of some public goods and where markets fail.

"Where markets fail" ? The markets [b]"fail"[/b] !!! WTF ?? 😯

Now that's not a term you ever hear the public sector bashers talk about.

Yeah, the markets fail ........when it comes to the railways, and the banks, and training, and nuclear energy, and affordable housing, and agriculture, and manufacturing, and infrastructure projects, and services, and education, and healthcare, and research, etc, etc, etc.

Ernie - perhaps some balance to the argument, might make it stand up. Three legs to a stool, not one?

"Where markets fail" ? The markets "fail" !!! WTF ??

Whereas, governments have an excellent track record of allocating scarce resources?

Whereas, governments have an excellent track record of allocating scare resources?

Right, you're now saying that the private sector is no worst than the public sector.......we're getting somewhere !!!

EDIT : Or is it that the public sector is as bad as the private sector ? 😕

Either way, I like where this is going 😀

Ernie - we have a mixed economy. Why? Because history has shown us that there needs to be a balance between the two ends of the spectrum of resource allocation - ie, free markets versus state planning. Any basic student of economics knows this from term 1.

Personally, I think that framing the current debate in terms of the failure of capitalism is incorrect. With respect to markets, I think that history will tell us that we have seen a [b]failure of capitalists[/b] rather than capitalism. We have also seen a massive failure in government allocation of resources and the absurdity (sorry for the over-use of this word!) of the European project.

What makes the current situation so challenging is that the fortunes of the household/banking and government sectors are so completely intertwined. Hence framing arguments around one end of the economic/political spectrum is unlikely to lead to the appropriate conclusion. IMHO, of course!!!

Take taxation - we have a system that is both progressive and regressive and distorted by the impact of benefits. But on balance it is clearly regressive. So why do we have sustained and arguably unequal distributions of income. It is far more complicated that the facile arguments presented by certain posters above!!

"You won't find me defending that, except I will point out that the taxpayer made less of a loss on Northern Rock than most sane people expected (Branson overpaid)"

^^^ what a crazy comment. We were assured by the government it was an investment for the future. Then they sold it at a loss of millions. Our politicians seem to have an issue with telling the truth and/or making promises to teh public they cannot keep.

The Guardian's piece on this is interesting, especially the ending:

Public sector pensions are more generous than private sector ones because they are [b]far more likely to have one,[/b] and to have a [b]defined benefit[/b], rather than defined contributions scheme. This [b]links [/b]their pensions to their [b]final salary[/b] and is [b]more generous[/b]. This is what some people refer to as the "gold-plated" schemes. [b]However, the average public sector pension is £7,800, which, combined with the state pension would leave these people hovering around the poverty line. [/b]The question of whether pensions are affordable is a political one, but over the longer term their costs will fall as a proportion of GDP.

In the run-up to Wednesday's strike I'm going to look into the claims about the impact of the changes that the government are proposing and how this will affect the situation. I'll continue by scrutinising some of the claims and counter-claims made by the government and the unions in the row. To introduce that political debate, Dan Milmo, the Guardian's industrial editor, writes:

Fairness is a concept that crops up a lot in the debate over public sector pension reform. For the government, it is only fair that state-backed workers pay more contributions - an extra £3bn a year by 2014/2015 - and work longer in order to justify pensions that, unlike most of their private sector counterparts, have a defined benefit or guaranteed monthly payout at the end of them. They are, after all, underwritten by the taxpayer.

For unions, it is unfair because a pension is a key reason for doing a job that can involve more mental and physical toil than the average private sector post (although experts claim that the real reason for decent public sector pensions is an historic wage disparity with the private sector). They also argue that the sheer scale of reform sought by the government is unjust: raising the retirement age in line with the state pension age; switching the rate at which benefits grow from the RPI rate of inflation to the less buoyant CPI; moving staff in the NHS, local government, civil service, schools and uniformed services from final salary schemes - where the payout is a proportion of the salary at the end of your career - to pensions schemes that payout a proportion of your average earnings over your whole career.

The average public sector pension is around £7,000 per year while in the private sector the average defined contribution (money purchase) pension pot is around £28,000 on retirement. That would buy annual income of about £1,650 if they bought a flat rate annuity that didn't increase with RPI, or £1,050 if they linked it to inflation.

All a nice summary, before the killer blow:

You could argue, as do the unions, [b]that neither the private nor public payouts look that attractive [/b] and it is private sector employees who should be the focus of attention.

Perhaps, the real message is that few of us can rely on a pension alone to support us in our old age?

I think it's disingenuous to describe what we have as a "mixed economy". We had a mixed economy 30 years ago, when the utilities, public transport, coal, steel, telecommunications, large chunks of engineering, etc, were nationalised industries. Since then, everything that can be privatised has been privatised, it can no longer be classified as a mixed economy - the only thing left is health, education, police/military, and bureaucracy.

Ernie - we do have a mixed economy. You could argue that we have an un-balanced economy, but you cannot say that we have either a free-market or a command economy.

Governments allocate resources directly and indirectly across all areas of economic activity. Markets do so in other areas. Both do some things better than others and vice versa - it was ever thus.

Anyway - nice debating briefly. Have a fun weekend - and keep the debate real/polite?

The Guardian's piece on this is interesting, especially the ending

The only thing I find interesting in the Guardian is the news, the letters page, and Seumas Milne 🙂

On a general note. Such politic topics like these shouldn't be allowed as there are always opposing sides trolling then getting upset. Its not good for general 'health' of the forum is it?

I'm no bloody angel either but its just a mission to anger and a online moshpit.

After my day at work I'll fight for my pension. And I know at least one family who will support me.

Such politic topics like these shouldn't be allowed as there are always opposing sides trolling then getting upset.

If anyone gets upset over politics then they deserve to be upset.

And there's nothing wrong with a bit of trolling btw.

Some people need to sort themselves out and not get so easily wound up - if that's the case.