Wednesday, 30 November 2011


I'm not sure how I feel about strikes.

Of course there are times when no one is listening and people are being sat on, and there's nothing else for it but to stop work until they do, but it really has to be a last resort, because there are always people who suffer and it's not only management and shareholders.

So what of today's strike?

From all I can gather the government is still saying that they will talk, but at the same time they are saying that they won't go any further or give any more, so you have to ask, what is the point of talking?

But are the public sector workers that badly done by compared with the private sector and self employed? After all we are all in this together. Everyone has to take a hit.

I posted a week or so ago about the pensions situation, and Edward Spalton made good points about the plight of the self employed person who has saved for his retirement, and is dependent upon the value of the stock exchange at the time of purchase, for the value of the pension.

I partially quote him here: "I just had a quick look at annuity rates for a man aged 65. With a private pension "pot" of £100,000. In May, this would have bought him an income of £6813 per year, today that is only £5972."

It's actually quite difficult to put together a pot of £100,000. Say you work for 45 years, that's £2,000 + a year, and let's face it, at least at the beginning that's not an easy sum to take off your income, when there's a mortgage and kids, university, weddings, etc.

Again as Mr Spalton points out, there is a chance of losing money with rogue companies (like Equitable Life), who because of mismanagement as far back as the 1950s, are unable to pay up pensions as promised.

And many people employed in the private sector now have that kind of pension too, where you buy your annuity, rather than final salary pension.

Even company pension schemes can go belly up. I heard a few years ago about a man who was ready to take early retirement at 63, with his wife of 60 (at that time eligible for a state pension). They had sold the house and bought property in Spain and about a week before his retirement date his company pension fund went broke, leaving all his plans shattered.

So the public sector pensions, poor as they are, are better than many people have. And these people are helping to subsidise the public sector.

And yet, that is what they signed up for. It's in their employment contract. Stability, nothing grand, just stability. 

As I said in the post I referred to earlier, the government ministers negotiating this settlement with the unions, where people work longer, contribute more and get less, Danny Alexander (whose constituents marched on his office today demanding his resignation) and Francis Maude, have managed to see THEIR pensions untouched.

As Craig Murray points out here what many of the strikers interviewed by tv and radio stations today find so unpalatable is that THEY are paying, these cleaners and the mocked dinner ladies, office workers on 3/4 of the average wage, for the folly of people who have been touched not one tiny bit by any kind of reduction in their terms and conditions.

Bankers' and ministers' terms and conditions carry on as if nothing has happened and let the rest of the population pay for it.

On reflection, I think that today was justified, if only to show the government that it can't ride roughshod over people's terms and conditions and expect them to take it lying down, especially when the people responsible are laughing all the way to the Seychelles  or, in the case of ministers, the British Virgin islands, where they (or at least some of them) keep their fortunes. 

PS: Jeremy Clarkson, who is paid over £1 million pounds a year by the taxpayer funded BBC, said on The One Show, which goes out at 19.00 and so is watched by kids, that strikers should be taken out and shot in front of their families. Why, he wondered should they get guilt edged pensions while the "rest of us" work for a living? 

Sack him.


  1. I spoke to a dinner lady today who was so upset about her vocation being used as an example, she was nearly apopleptic. She is only 48 and doesn't mind working another year. Her pension will not be reduced, in fact she says it will increase because of the few per cent she contributes.

    She insisted that using low paid workers like herself do nothing for the cause and has resigned her union membership.

    Her last comment was "Why don't the unions concentrate on the big salaries of the top brass?" She answered that herself by saying union leaders and representatives are part of the 'top brass'.

  2. It's a mad world right enough. The private banksters gambled with other people's money and lost. Instead of going bankrupt ( like in a real "Capitalist" system ), they were bailed out by taxpayers and the culprits were either given a millionaires pension or left in post.
    They continued to gamble ( with mainly taxpayers money this time), giving themselves large bonuses for their cleverness, and the real depression is now upon us. This is no " second dip". We were never out of a recession. It was just masked with trillions of pounds of printed money. So we're in a depression and in order to try and climb out of it the ConDem's master plan is to attack the public sectors alleged " golden pensions". How can an average pension of £5,000 be called "golden" ? The millionaire Tories with the help of their lackies in the Limp Dems will allow the banksters to walk away unscathed while the public ( and private sector - increased taxes and attacks on private pensions ) pick up the tab.
    The same thing has happened across the Western World so it looks like a concerted conspiracy. The EU banks seem to be the worst. One bank in Greece defrauded £800m and got a bailout from the ECB ( taxpayers) of £800m.
    I fear the lid will blow off by January.

  3. I did a quick google on public pension schemes and I found a strange fact.

    A large chunk of public service pensions are not funded. In other words they are paid for directly out of the current employee pension contributions and by general taxation. In other words the Government is directly liable for public service pensions which are unfunded and they simply can't afford them anymore because there is no pension fund behind these pensions.

    If you look up "unfunded pension schemes UK" on Google you can find more info about this and this is a quote from a Telegraph article:

    "Unlike company pension schemes, under which retirement benefits are paid out from money that has built up in the scheme during the years preceding the members' retirement, benefits for retired workers who belong to the unfunded public sector schemes are paid out of current employee contributions and general taxation.

    The four main unfunded schemes are the Armed Forces Pension Scheme, the Principal Civil Service Pension Scheme, the NHS Pension Scheme and the Teachers' Pensions Scheme.

    Payouts to the two million pensioners who belong to these schemes totalled £19.3 billion in 2008/09, a 38pc increase in real terms since 1999/2000. The report said the rise had been driven by more employees retiring each year, which was a substantially more significant factor than people living for longer.

    Within the total, employee contributions accounted for £4.4 billion, a 56pc rise since 2008/09, with the taxpayer's share of the costs standing at £14.9 billion."

    This is a problem that has been looming for years.

  4. She may be exceptional in that she wants to work an extra year. I simply have not met anyone now, with the exception of Pet Clark, who enjoys their job enough to do it for a day longer than they have to.

    Targets, shortage of staff, and yes, rules and regulations about heath and safety, all make work more and more trying.

    I've worked closely with people in Jobcentres, social work, courts etc etc for years and I haven't met one that wouldn't leave tomorrow if they could SR.

  5. Why are those schemes unfunded?

    because the employer has decided to use them as revenue

    The argument here seems to be "no one should stop employers looting from their employee at any time AND, if you've been shafted, it is your duty to make sure that other workers share your pain!"

    Public sector workers suffer from a effective reduction in earnings year on year.

    The only time anyone in the rank and file got an above inflation pay rise was when they had to raise the pay to minimum wage of the lowest paid.

    That fact that so many of the public sector gets tax credits, or would do if they had kids, should alert you that the pay is not great

    The flip side of that was the pension, not gold plated, but stable

    But apparently the public sector don't deserve what they contracted for, probably should just be grateful for some pay at all, as we know, they are subhuman scum

  6. btw I had to work to 65 as it was to get my full pension.

    So I didn't have a great hope of getting it anyway, as no male in my family in the last two generations has reached that age. hell, I beat my dad and uncle by 10 years already, catching up with my grandad, odds are against me

    And why should my widow get what she is supposed to,serves her right for marrying a public sector worker, right?

  7. Couldn't agree more Monty.

    There was no climb out of recession at the end of Labour's disastrous government in 2009 and into the beginning of this awful set of amateurs. They masked it all with quantitative easing, or to put it another way, printing loads of money and devaluing the currency causing inflation, which once again the banksters and ministers don't have to worry about, but the poor do.

    At the risk of becoming a bore on the subject I'd repeat that Francis Maude's pension of around £44,000 and is not to be reduced (added to which he'll almost certainly go the the Lords and get £300 a day for the rest of his life and a shed load of commissions from the government to look into this and that at £100,000 here and there).

    As you say, the average public sector pension is around £5,600. As there are many larger ones (doctors, surgeons, professors, managers), there must be many lower ones.

    I don't mind them having a go across the board and hurting everyone if that's what has to happen to get the mess sorted BUT THEY WON'T TOUCH THE RICH!

  8. Doug, Nice to see you again after a while...

    Actually I did know that, or at least some of it. Don't ask me how I knew it, but anyway..

    It has indeed been looming for years and no one has done anything about it because our leaders are so busy worrying about running the world as America's bag boy, that it forgot about silly old domestic matters.

    One of the reason this country is so badly governed is that the government is far too busy playing at being Lord Palmerston and sending imaginary gun boats.

    If they'd get on with running the UK and leave the rest of the world to run itself they might be doing us a bit more of a favour.

  9. Well Anon, I'm sure not even the likes of Francis Maude, whose a bit above the rest of us, or likes to think he is, considers public service workers to be subhuman scum.

    Everyone, except the top people have been treated badly over the 10 years or so since the idiot Gordon brown raided the pension funds.

    People have lost money on annuities as Edward Spalton pointed out. Saving £200,000 into a pot...almost impossible when you are a normal worker, is the only way that (at present) you could get a quarter decent pension.

    Public sector are being treated badly by this government, but remember that the private sector was treated incredibly badly under Labour. People who lost pensions in the Equitable Life scandal aren't getting more than a tiny amount back. And the story above of the man who thought he was retiring on a 2/3 of this final pay wasn't made up. I remember seeing the guy on tv. He was broken. No home, no job, no money at 63.

    I'm sorry to hear about your family health history and I sincerely hope you'll break the pattern.

  10. tris

    Being missold an endowment policy 9when I didn't even own a house) I know how badly things were 9and are) in the finance industry

    But you seem to be continuing to argue that because X got shafted, then everyone else must be dragged down to the same future of penury and choosing between heating and food as they, rather than trying to fix things and help them back up

  11. No, I'm not really saying that Anon.

    We are told we are all in it together. Now the government has decided that that excludes bankers/financiers and government ministers, MPs, lords and the royal family.

    But the rest of us are in it together.

    So, given that we need to repay this (and we probably have no choice in this matter, unless we have a revolution, which is fine by me, I've got some rope in the shed), everyone needs to suffer a little so that no one must suffer a lot.

    I was behind the strike on balance to show the government that they just can't pee all over people. But I'd even be in favour of a total days walk out by everyone to let the government know who is boss. But in the end we are, whether we like it or not, going to suffer.

    Living in Britain has never been great for the less than rich; it's about to get a whole lot worse.

    We need independence.

  12. There is a very informative post, dated 28 Nov on

    NIPSA, the Northern Ireland Public Service Association has an agreement to pay its own employees the same rate of pension as its members in the public service enjoy.

    The cost of doing this is an annual premium equivalent to 40% of salary. I understand that what the trade union movement is beefing about is that they will be required to pay around 3% towards this instead of having it paid for them by the taxpayers in the wealth producing sector - taxpayers who could not ever dream of affording such a pension.

    DoughtheDug points out that there are variants on this within different parts of the public service but it is still an enormous benefit, made more so by the fact that we are all living longer.

    The difference used to be taken into account by public sector salaries being somewhat lower than in the private sector but with greater job security, earlier retirement and the pension it balanced out.

    Now public sector wages are considerably higher than their private sector equivalents, so the disparity is even greater.

    With regard to MPs, the culture of benefits, perks, pensions etc had its small beginnings in 1971. Until then MPs got a pretty good salary (which they decided for themselves), first class rail travel to and from their constituencies, franking for their mail and 2,000 sheets of paper a year - no pension, no second home allowance, no office staff, no duck houses or moat cleaning - zilch.

    One prescient MP said this was perfectly adequate and opposed the changes. He said that the sole object of paying MPs was so that unmoneyed men of ability could serve their country in Parliament. The more a parliamentary seat approximated to a salaried, pensioned career, the greater would be the control exercised by the party selectors. This would result in a different type of MP and a different, more subservient relationship between parliament and government. That MP was Enoch Powell.

  13. The situation is actuall worse since this was written after 2 years of pay freezes and the cap announced by Osborne that says next three years, never mind this EXTRA 3% on top of ALREADY EXISTING contributions he also proposes to remove

    Pensions in the civil service are far from generous and have been changed recently to a career average scheme.
    The growing gap between public and private sector pensions is the fault of private sector employers retreating from decent pensions. The real divide is between executives in the boardroom securing for themselves large pensions with low retirement ages, and their workforces suffering repeated cuts.
    It is counterproductive to degrade pensions because it will force more people into poverty and onto state benefits in their retirement – this is more costly and will have to be met by future taxpayers.
    We all help to pay for private sector pensions through the price of goods and services. And we all help to contribute to public sector pensions through taxation.
    Excluding the very highest earners, the average civil service pension is £4,200 a year.
    More than 100,000 people receive a civil service pension of £2,000 or less a year: over 40,000 receive less than £1,000, and more than 60,000 get between £1,000 and £2,000.
    Two and a half times as much public sector money is spent subsidising private sector pensions through tax relief than paying for public sector pensions – 60% of this goes to earners at the higher rate.
    The Treasury’s estimate of the cost of public sector pensions as a proportion of the UK’s national output shows a modest increase from 1.5% to 2% by 2027/28. After this, projections show a slight decline.
    The civil service is covered by a collection of several different pension schemes which have developed over the years. The most recent is called nuvos and is a defined benefit whole career base scheme for new entrants from 30 July 2007.

  14. Since 2007, basic pay in the civil service has increased by 6.5% and inflation by 10%, meaning a real terms cut in living standards.
    Almost half (48%) of civil servants are in admin grades where the average (median) pay in 2009 was £17,120 for women and £17,600 for men.
    Average civil service pay is £22,850 a year, compared to £24,970 in the private sector.
    35,000 (7%) civil servants are paid less than £15,000 a year.
    40.5% of civil servants - 210,000 people - are paid £20,000 or less. And 63% of civil servants - 330,000 staff - earn less than £25,000 a year.
    There are currently 230 separate sets of negotiations over pay and terms and conditions across the civil service.
    A member in one department can earn up to a third more than a member in another department/agency on the same grade.
    Government plans to cap public sector pay at 20 times the lowest salary will have very little impact in the civil service. In the Department for Work and Pensions, for example, the lowest paid are on £13,110 and the highest paid is the IT director on £249,999.
    Unlike elsewhere in the public sector, progression costs for civil servants are included in the overall pay pot. So when pay is frozen, they suffer a double whammy of not being rewarded for length of service or given a cost of living increase.
    When you compare civil service grades with comparable jobs in the private sector, admin officers, who deliver services such as getting people back into work, tax credits and passports, are paid 21% less.
    Executive officers, who typically work as supervisors and in roles that require a vocational qualification, are paid 18% less than the private sector.

  15. Those bits of info, and, as I said, the situation is worse than when they were written, come from the PCS website

    Over the years Gov't has done a lot of tricks over pay

    Non-consolidated one off payments, you get a bit of money, but it isn't added to your salary so next negotiations you start at the same lower amount

    Deferred pay rises, giving themselves months where you are paid at the lower amount

    Announcing a package as value X, then it turns out X is overall pay bill, and most receive very little, if any, pay rise

    And, my favourite from G Brown, at a time when Private Sectir pay rises were about 3 - 4%, public sector has to accept a lower pay rise to encourage restraint in the private sector

    The stats that purport to show private sector as worse paid, always seem to include minimum wage workers in the food industry and elsewhere, not like for like. E.g. I had hits through LinkedIn from headhunters where the private sector salary on offer ( in the last six months, from financial sector) was 40% to 50% higher than my public sector one

  16. Hi Tris, the fact that the Government funds a large chunk of public service pensions directly rather than through a fund means that public service pensions can be considered as the first really visible public indicator that the Government has run out of money.

    As Monty said earlier in this thread, in a true capitalist system the banks would have gone bust as failed businesses. However as soon as the brown stuff hit the fan the banks turned from capitalist we're all right jacks to give us your money comrade, it's for the greater good communists.

    The fact that all the European governments apart from Iceland handed over huge amounts of cash to these failed businesses with no guarantee of return is a worrying indicator that the governments of Europe are following a corporatist model with its roots in fascism.

    The banks have not been allowed to fail because the links between the banks and the ruling class have become so close that the ruling class cannot contemplate their failure.

    The banks are in trouble because they lent money speculatively, they got caught up in trading and selling "derivatives" which were based on dodgy or nonexistent assets and none of them had enough assets to cover their bad debts and governments have handed over billions to these banks which have proved to be utter incompetents when it comes to handling money.

    I think strikes are useful to show the public's displeasure but the only real solution is the ballot box and to completely kick out all Labour and Coalition MP's from Westminster as utter failures.

    In Scotland we can follow our own route and ditch Westminster which has always been my preferred solution.

  17. Mr S and Anonymous.

    Thank you for these informative contributions. Some of the facts appear to be at variance between the two. For example Mr S, you say that the public sector employees will be required to pay 3% of their salary towards pensions, whereas Anon quotes that 3% as being "an EXTRA 3%". On top of what, I don't know.

    There also seems to be variance on the comparison between the salaries in public and private sectors, with Mr S suggesting that the historic disparity has disappeared and Anon suggesting that it has not.

    I'm not in a position to judge, but I'm certainly most interested to see if I can find out which is the case or if, as I suspect, both are true, at different levels in the organisations.

    I see one thing coming out time and time again from commentators in the press, and Mr S mentions it again here. That is the undisputed fact that the private sector is wealth creating, which of course it is.

    But I think we should remember that the public sector is, none the less, hugely important in our lives. Just as emotive, I suppose, is the fact that the guy who saved your granny's life when she had a heart attack, is a public servant, as are the people who drove the ambulance, wheeled her in, gave her her medication, cleaned around her bed and cooked her meals.

    Even the much maligned social workers, whom the press never tire of criticising, provide a service which is necessary. Working at close quarters with them I am only too aware of some of the kind of things that might happen without their interventions.

    Yes, political correctness is rife, but that's only because without rules (and even sometimes with them) people like Stephen Lawrence are left to bleed to death and no one bothers much to chase the "perps" because officials can't be bothered. After all he was a teenager and black, ergo he was probably to blame. And we all know how wrong that was.

    Anon: I have to say thank you for going to the trouble of writing that post, packed with statistics of which I had no knowledge. I appreciate the amount of time and effort you put into it.


  18. Mr S: Thank you for the facts which you provided about MPs terms and conditions. It's strange, we should by and large like these people whom we chose to represent us. But, in reality, MPs, although liked individually, are en mass as disliked as are bankers and estate agents.

    The trouble with providing pensions and second homes for them, I think, is that it encourages them to see it as a profession, which of course it should not be, and indeed isn't.

    But then our whole system begs for this kind of dislike and mistrust. FPTP, whipping, ministers chosen from parliament, and career opportunities depending on loyalty to party and in particular leader, rather than to the people who elected them.

    I can see what Powell was saying. By the same token I understand that making the job one which only the very rich can contemplate, and part time at that, probably not as the main occupation, is hardly likely to provide candidates who are representative of their constituents, unless their constituents all come from the kind of village where Cameron lives.

    What to do?


  19. tris. Yes you're right. They won't touch the rich. The Hyde Park 1 post code in London is the wealthiest area in the world yet only 9 people are listed as paying council tax.
    The Con Dem's say it's essential to reduce public sector pensions because it hasn't been funded properly and will go bust otherwise. Well whose fault is that ? It's like the National Insurance scheme and the vehicle excise duty scam. The payments in are frittered away and not invested where they should be.
    Equitable Life is an example of where a private sector ponzi scheme was 'rescued'. Jim McFail of Labour played with the disaster for about a decade before kicking it into the long grass as it was too hard for him to fix. The Tories got in and announced a rescue package within 6 months. People will get their money back. The public sector pension scheme will face death by a thousand cuts while we divert the money paid in to overseas aid, wars, EU etc...

  20. Employee contributions vary from bit to bit of the public sector

    When I worked for the council all those many years ago it was 9%, for example

  21. Doug:

    Bang on the nail.

    The banks privatise profits and socialise losses, learn very little from the situation and are allowed to keep our money as profits and bonuses.

    Under the convenient pretence of suddenly discovering prudence, they refuse to lend to businesses or potential house buyers and force the compliant government to do it for them, further socialising the risks.

    And we sit back and grumble and write blogs calling them all "banksters" and far worse. Meanwhile they think were a load of stupid peasants, and they get on with their wealth accumulation and their living in a different place from the rest of us, which the government of whatever shade, which is too thick, or too ensnared in party funding deals, do whatever the big boys demand.

    The Icelandic model is one we should have followed. People's savings up to a certain level should have been secured and the people who said that, if we didn't do exactly what they wanted they would go to Hong Kong or New York or Delhi or Rio, should have been told not to let the door hit them on the way out.

    And they still call them WEALTH CREATORS!!!!!!!!!!!

  22. Monty: I think that Equitable Life people are getting only a small part of their money back, and at that only a certain number, although I'm a bit short of details.

    I seem to remember hearing that there wasn't nearly sufficient in the government fund to make up the difference.

    I could be wrong (it has been known).

  23. Anon:

    9% + 3% is actually a very substantial part of your salary.

  24. NHS fund, so I read, was not only fully funded but in surplus, and that, according to the DWP, was at 6.5%

  25. So some of the pension schemes are funded and some are not?

  26. Fue mierda horrible. Hemos jugado durante 2 minutos de esa hora y media

  27. No, *ALL* have contributions, but for some the Government treat it as income, rather than setting up a fund. Is that the fault of the employees?

  28. Muy interesante, satisfaga el elabourate, Anon.

  29. Sorry Anon, that was what I meant. Some are funded, as in have funds set up, and some are simply paid from government funds, and the employee contributions treated as general taxation.

    No, most certainly not the employees fault. All the fault of government.

    As usual the UK government couldn't run a booze up in a brewery.

  30. Sorry. I was playing a new online game, on Wednesday with a pal in central Europe, yesterday with one in Spain.

    Or at least trying to, the connections kept dropping out, 2 mins play in 1 and a half hours.

    And I was waiting for my Spanish pal to try to connect as I read the blog, and put my chat into the wrong pop-up box.


    So far not impressed with Steam

  31. je je... OK Anon.

    Buena suerte con el juego siguiente