Govt Pensions Revealed

[Non-Believer]

Alf reveals Govt Pension payouts (iomtoday). Some big numbers and lucky people in amongst them. But it wouldn't be fair to be too specific for fear of the recipients being identified. Just rewards for a lifetime of gruelling IoM Public Service.

Apparently.

Edited June 18, 2018 by Non-Believer
Bit more

[the stinking enigma]

70 grand a year is some going

[gettafa]

Bad enough now with mortgages paid off and kids off their hands but imagine these people in their 80s and 90s, raking it in 'til the day they die.

[piebaps]

The full answer from last week's Keys is here http://www.tynwald.org.im/business/hansard/20002020/k180612 RHC.pdf @ line 225

A brief analysis shows that 86% of pensions currently in payment are less than £20k annually (5585 out of 6500).

10% are paid between £20k and £30K

The remaining 4% over £30k.

 

[Non-Believer]

8 minutes ago, gettafa said:

Bad enough now with mortgages paid off and kids off their hands but imagine these people in their 80s and 90s, raking it in 'til the day they die.

And in the case of "passing on" Tynwald members, considerable percentages passing on down to their widows and children?

[Trueblood]

What gets me is the percentages of final salary that they eligible too. A firefighter can get 67% of their final salary as a pension, that's nuts because there's no way during their employment that they would have contributed enough from their salaries, as over say a 30 year period, for the most part, they would have been earning nowhere near their final salary and their contributions would be in line with what they were earning at the time, not what they were going to earn in the future.

[woolley]

Should be capped at £25k (remember that this is in addition to state pension), and lump sum capped at £75k.

This would be seen by the wider population as at least more acceptable.

It is only a small percentage of government pensioners receiving grotesque amounts and it is getting the rest tarred with the same brush.

[Mr. Sausages]

Shipman would have stopped this.

[John Wright]

1 hour ago, Trueblood said:

What gets me is the percentages of final salary that they eligible too. A firefighter can get 67% of their final salary as a pension, that's nuts because there's no way during their employment that they would have contributed enough from their salaries, as over say a 30 year period, for the most part, they would have been earning nowhere near their final salary and their contributions would be in line with what they were earning at the time, not what they were going to earn in the future.

But the contributions paid by both employer and employee over that 30 year period should have been invested and the longer they were in the fund the more their value should have increased.

If it had been fully funded we wouldn’t be having this debate, apart from the actuarial nightmare of increased life span.

Future generations of retirees will have paid in sufficient to cover their pensions.

So the problems arise with the existing CS pensioners, and those who retire over the next few years.

I read the full reply. The vast majority are on £10,000 or less. I’m not in favour of introducing pension caps. If they’re paid the right sum for their expertise and have worked 30 or 35 or 40 years. After all 20% of the higher pension is circular and goes straight back into Government coffers as tax, plus they spend, contributing VAT and duties.

[wrighty]

1 hour ago, woolley said:

Should be capped at £25k (remember that this is in addition to state pension), and lump sum capped at £75k.

This would be seen by the wider population as at least more acceptable.

It is only a small percentage of government pensioners receiving grotesque amounts and it is getting the rest tarred with the same brush.

That's fine, except you can't tell someone who's a few years from retirement and has been told for the last 2 decades that they were going to get a lump of £300000 which they had earmarked for a mortgage, as well as being told to 'plan for retirement', that it's all gone.  A change in T&Cs as drastic as this needs to be identified early so people can prepare.  Chaos ensues otherwise.  

Any changes have to be proportionate and graduated, rather than Draconian.

[Galen]

What is not clear from these figures is that IOM Govt pensioners at the point of retirement have the right to decide how much pension they want take and how much they want to trade-off for a  lump sum. So at one end of the scale they can have a small pension and a large lump sum, at the other end a large pension and a zero lump sum and anything in between. Given the worrying future over the state of the Govt pension pot that has been regularly mentioned for several years, many recent retirees might have been tempted to go for the highest lump sum possible and a lower pension. My point being that the what has been reported is what the current position is, not what the ongoing pensions could have been had individuals not taken higher lump sums.

Also what is also not mentioned is that many of those that work in the IOM public sector and worked previously in the UK, e.g. in health, brought their accrued 'pension pot' with them which was then added to the 'IOM pot'. To dilute their contributions to their retirement, earned elsewhere, would be unjust.

Nevertheless, given the figures, and looking at Public Sector salaries, it is not too difficult to see that it is the long serving high earners that will be the biggest beneficiaries of the IOM Public pension. However, while as is frequently the case on this forum, the degree of scrutiny that is given to the Public Sector pensions, is conveniently diverted away from what the private sector pays its retirees. For example, Banks, Telecoms. IOMSPC, etc. all of whom we, as customers, contribute to their staff pensions as well. Perhaps if the same degree of openness that is demanded of the public sector was applied to the private sector, there would be a more 'level playing field' to discuss.

[Nom de plume]

Although some of the amounts being paid out are incredibly large (and good luck to those people who got in at the right time), it's the actual amount of persons receiving the pensions which is ringing the alarm bells.

Bloated.

[woolley]

3 hours ago, wrighty said:

That's fine, except you can't tell someone who's a few years from retirement and has been told for the last 2 decades that they were going to get a lump of £300000 which they had earmarked for a mortgage, as well as being told to 'plan for retirement', that it's all gone.  A change in T&Cs as drastic as this needs to be identified early so people can prepare.  Chaos ensues otherwise.  

Any changes have to be proportionate and graduated, rather than Draconian.

I understand your point, wrighty. I have considered this at length over many years. These arrangements were flawed from the start. They arose out of negotiations between trade unions representing government employees and, er, government employees representing the taxpayer, so no vested interests there then. I appreciate that some of the agreements have been foisted on us from across.

So you are worried about someone who has earmarked a £300k lump sum for a mortgage? I hardly think that £25k per year (plus state pension) and £75k lump sum is draconian. Most right thinking people would be extremely chuffed with that. What about the youngsters who will pay for this largesse all of their working lives, and who will be lucky if they ever amass enough capital for a deposit on a starter home? That is where chaos may ensue, and who could blame them for kicking against the elderly fat cats who may be sitting pretty for decades.

It's fine to make crazy promises but when things change you can't get blood out of a stone, as many in the private sector have found to their cost, in both terms of employment and pension arrangements.

[WTF]

4 hours ago, Galen said:

What is not clear from these figures is that IOM Govt pensioners at the point of retirement have the right to decide how much pension they want take and how much they want to trade-off for a  lump sum. So at one end of the scale they can have a small pension and a large lump sum, at the other end a large pension and a zero lump sum and anything in between. Given the worrying future over the state of the Govt pension pot that has been regularly mentioned for several years, many recent retirees might have been tempted to go for the highest lump sum possible and a lower pension. My point being that the what has been reported is what the current position is, not what the ongoing pensions could have been had individuals not taken higher lump sums.

 

there is no sense in taking a lesser lump sum,   if you drop dead tomorrow any dependants will have less or nothing.   most folks take the biggest lump sum possible and maybe invest that so they end up with a weekly income similar to taking the little lump sum option.

[WTF]

4 hours ago, wrighty said:

That's fine, except you can't tell someone who's a few years from retirement and has been told for the last 2 decades that they were going to get a lump of £300000 which they had earmarked for a mortgage, as well as being told to 'plan for retirement', that it's all gone.  A change in T&Cs as drastic as this needs to be identified early so people can prepare.  Chaos ensues otherwise.  

Any changes have to be proportionate and graduated, rather than Draconian.

i get what you're saying and agree about graduated change,  but an option for all newcomers is to only take contributions that would result in a final pension of 25k a year and if they want to have a bigger pension they take out a private one .