Public sector want inflation busting rises again

[John Wright]

23 minutes ago, Andy Onchan said:

I'd rather the Unions started suggesting to their members that they should pay more into their pensions schemes:

 

They pay more here than UK. There’s been a recent revaluation and actuarial projection. Yes, there are still unfunded liabilities, but assuming the payments in by both employer/employee they’ll reduce over time. It’s greatly helped by the move from final salary to career average and the unified scheme. The IoM scheme is looking less and less like a ponzi.

As at 31 March 2022 ( report issued March 2023 ) the Local Government Pension scheme is 96% funded. Increased stock market levels since will probably have that over 100%.

https://iomlgps.im/wp-content/uploads/2023/04/IOMLGSS-2022-Valuation-Report.pdf

im looking for the recent iom CS scheme report

 

[Andy Onchan]

27 minutes ago, John Wright said:

They pay more here than UK. There’s been a recent revaluation and actuarial projection. Yes, there are still unfunded liabilities, but assuming the payments in by both employer/employee they’ll reduce over time. It’s greatly helped by the move from final salary to career average and the unified scheme. The IoM scheme is looking less and less like a ponzi.

As at 31 March 2022 ( report issued March 2023 ) the Local Government Pension scheme is 96% funded. Increased stock market levels since will probably have that over 100%.

https://iomlgps.im/wp-content/uploads/2023/04/IOMLGSS-2022-Valuation-Report.pdf

im looking for the recent iom CS scheme report

 

Mmm.... but if I understand correctly the future service rate for the employer (in other words the rate payers) has increased over the three years (2019-2022) to 24.2%, up from 22.6%, whilst the employees rate has remained the same @ 6.25%. Ignoring any stock market investment increases the increase in funding the shortfall has fallen on the Local Authorities and by extension the rate payers. Or have I got that wrong?

[John Wright]

8 minutes ago, Andy Onchan said:

Mmm.... but if I understand correctly the future service rate for the employer (in other words the rate payers) has increased over the three years (2019-2022) to 24.2%, up from 22.6%, whilst the employees rate has remained the same @ 6.25%. Ignoring any stock market investment increases the increase in funding the shortfall has fallen on the Local Authorities and by extension the rate payers. Or have I got that wrong?

It’s a cost of employment, that falls on the rate/taxpayers. What’s most important is that there isn’t an unfunded black hole.

[Non-Believer]

3 minutes ago, John Wright said:

It’s a cost of employment, that falls on the rate/taxpayers. What’s most important is that there isn’t an unfunded black hole.

But it could be argued that the black hole still "exists". It's just been transferred directly to the rate/tax payers as a regular demand rather than accumulating.

[Ringy Rose]

41 minutes ago, Andy Onchan said:

whilst the employees rate has remained the same @ 6.25%

The employees’ rate is 7.5% on the new career average scheme, and higher for those on the old final salary scheme.

The person your article refers to is also at the far-right Institute of Economic Affairs- the organisation which advised Liz Truss to such spectacular success- so most of what they can say can safely be put in the bin anyway.

[John Wright]

18 minutes ago, Non-Believer said:

But it could be argued that the black hole still "exists". It's just been transferred directly to the rate/tax payers as a regular demand rather than accumulating.

The local government public servants and the IoM CS have dealt with contributions and deficits differently. The small increase in the (already ) large local government employer contributions hasn’t made the change from only 84% funded to 96% funded in just 3 years.

We got to look at the practical reality. For those in the schemes any introduction of increased employee contributions and reduced employer contributions will inevitably result in increased pay demands. 

There’s a cost to employment in public sector, actual wages, employers NI and pension package. Perhaps we’ve been dishonest about it for too long.

[Banker]

Just now, John Wright said:

The local government public servants and the IoM CS have dealt with contributions and deficits differently. The small increase in the (already ) large local government employer contributions hasn’t made the change from only 84% funded to 96% funded in just 3 years.

We got to look at the practical reality. For those in the schemes any introduction of increased employee contributions and reduced employer contributions will inevitably result in increased pay demands. 

There’s a cost to employment in public sector, actual wages, employers NI and pension package. Perhaps we’ve been dishonest about it for too long.

There’s a big cost to employment in the public sector which the unions also need to accept as every pay rise they get it costs a lot more because there’s not just the say 5% pay rise but NI and pension contributions on it plus extra sick pay costs on the new salaries.

[John Wright]

3 minutes ago, Banker said:

There’s a big cost to employment in the public sector which the unions also need to accept as every pay rise they get it costs a lot more because there’s not just the say 5% pay rise but NI and pension contributions on it plus extra sick pay costs on the new salaries.

NI and pension contributions will still only go up by 5% in your scenario. 

We need to be more honest about the base line cost.

Instead of setting and quoting salary levels by gross receivable before tax, superannuation and NI, we should give gross total cost of which x% will go into your vocational pension, y% into your state pension.

[Andy Onchan]

1 hour ago, Ringy Rose said:

The employees’ rate is 7.5% on the new career average scheme, and higher for those on the old final salary scheme.

The person your article refers to is also at the far-right Institute of Economic Affairs- the organisation which advised Liz Truss to such spectacular success- so most of what they can say can safely be put in the bin anyway.

So are the numbers not correct?

[John Wright]

42 minutes ago, Andy Onchan said:

So are the numbers not correct?

They are one way of looking at it. 

But it’s artificial, and designed to scare, as part of the Tufton St,  extreme right wing libertarian “think” tank propaganda, to reduce the size state, whilst protecting the wealthy and leaving the  the devil to take the workers,  philosophy.

Its the liability if the world stopped tomorrow and no one ever paid anymore in but everyone who was a member lived and drew on their benefits at once. 

Those aren’t rational or even actuarially correct assumptions. For instance, if the world stopped tomorrow there wouldn’t be any payouts, either.

[Andy Onchan]

10 minutes ago, John Wright said:

They are one way of looking at it. 

But it’s artificial, and designed to scare, as part of the Tufton St,  extreme right wing libertarian “think” tank propaganda, to reduce the size state, whilst protecting the wealthy and leaving the  the devil to take the workers,  philosophy.

Its the liability if the world stopped tomorrow and no one ever paid anymore in but everyone who was a member lived and drew on their benefits at once. 

Those aren’t rational or even actuarially correct assumptions. For instance, if the world stopped tomorrow there wouldn’t be any payouts, either.

The article says the numbers are from The Treasury and ONS. So are both of them wrong?

[John Wright]

17 minutes ago, Andy Onchan said:

The article says the numbers are from The Treasury and ONS. So are both of them wrong?

No. They are the liabilities if you draw a line today. You can’t argue with the raw data. But you have to look at it in context. I’ve tried to point out the context. It’s not realistic.

Remember the recent UK election, and the Con claim about £2,000 tax.

You only get there if you skew presentation.

[Ringy Rose]

15 hours ago, Andy Onchan said:

So are the numbers not correct?

The raw data is based on a situation where everybody stopped paying in and everyone drew their pension down all at once. So they are “correct” in that is exactly what would happen if we drew a line, everybody stopped paying in, and everyone drew their pension down all at once.

Clearly that will never happen- or, if it does, we’ll have bigger things to worry about than a pension liability.

Now why would a far-right Tufton Street think tank try to manipulate the data in such a ridiculous way? And why would the far-right Daily Telegraph repeat it as fact? It truly is a mystery.

Your number in relation to the percentage contribution was, indeed, wrong btw.

Edited July 19 by Ringy Rose

[Andy Onchan]

1 hour ago, Ringy Rose said:

The raw data is based on a situation where everybody stopped paying in and everyone drew their pension down all at once. So they are “correct” in that is exactly what would happen if we drew a line, everybody stopped paying in, and everyone drew their pension down all at once.

Clearly that will never happen- or, if it does, we’ll have bigger things to worry about than a pension liability.

Now why would a far-right Tufton Street think tank try to manipulate the data in such a ridiculous way? And why would the far-right Daily Telegraph repeat it as fact? It truly is a mystery.

Your number in relation to the percentage contribution was, indeed, wrong btw.

No they weren't wrong, the report was based on 2022 numbers not the current 7.5% and forget the politics behind the report and concentrate on the real issue (which is what I was alluding to initially) and that is, the current servicing of the liabilities has swung to the employer and thus the ratepayers and taxpayers. Why?

[Ringy Rose]

5 hours ago, Andy Onchan said:

the report was based on 2022 numbers not the current 7.5%

No, it was based on a selective interpretation of the UK numbers. It isn’t 6.25% here, it is 7.5%. And that’s on the career average pension; contributions for the final salary scheme are higher.

It’s also worth noting that it’s only a subset of the public service who pays that. My partner pays into the NHS pension and their contributions are over 12%.
 

5 hours ago, Andy Onchan said:

forget the politics behind the report

Impossible. Everything Tufton Street says is inherently political.