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Last Updated: Saturday, 11 December 2004, 13:33 GMT
Have your say: Civil service pensions
Civil service union members picketing
Civil service union members were already angry over job cuts

Government plans to end final salary pensions for civil service workers have been met with anger from the unions, and the threat of strike action.

Under the plans, pensions will be based on the average salary throughout workers' careers rather than on the last few years of pay.

Retirement age will also be raised from 60 to 65.

The civil service pension scheme has often been called the gold standard, paying a pension at 60 which can be as much as two thirds of the salary earned just before retirement.

We asked for your comments on the government's plans. Here is a selection of the views that we recieved.


Of course civil service pension arrangements should be revised. And so should pensions for politicians and the military services. Everyone's pension should be fully-funded and based on savings and investment.

That way there would be a level playing field for all, and salaries could be negotiated without the distortions currently claimed.

There will come a time when the tax-payer will no longer be willing to pay the public sector bill
Patrick Cooke-Priest
There was a time when civil service salaries were lower than comparable private sector salaries. It was cheaper for one government to make a future government pay the bill.

But for several years now civil service pay has been as good as anything comparable in the private sector.

A move to fully-funded pensions would have to be phased in over a good many years and of course existing contracts should not be broken, but unless a radical change is started there will come a time when the tax-payer will no longer be willing to pay the public sector bill.
Patrick Cooke-Priest

I am a lifelong civil servant who was entitled to retire as of as of last week at the age of 60.

When I chose my career, the qualifications and salary were identical to those of a teacher. Thirty years later the maximum pay in my grade is still less than 16,000.

Like many civil servants I am female and those of us who are now of retirement age did not have the option of returning to work part-time while bringing up a family.

As a result, although I have been a full-time civil servant from age 18 to 60, I only have 30 years service and my pension will be 30/80 of my final salary. That is, 5,600 plus a lump sum of 17,000.
M A Phillips

Confidence in government or financial services on long-term investment is absolutely zero, so any scheme from either of these has zero credibility, especially as the economic climate deteriorates.

Thatcher disassociated earnings, Brown raped the city, and now nameless is proposing to make the basic state pension free despite us contributing for years.

We could import masses of young labour to rebalance the population age profile
Charles McDoall
Saving for a pension depends on us using money as a savings account for use at a later date.

However when more of us have retired, there will be more OAPs and fewer producers, so the economy will be unable to perform. So all that saving will have been in vain unless the investment has been in a way to ensure that the working population can serve us as OAPs.

The solution? We could import masses of young labour to rebalance the population age profile. Perhaps we do need lots of immigrants after all.

My solution is to invest abroad in the third-world, and go retire there, thus injecting capital into the economy now ready for our retirement there later.
Charles McDoall

I have built up pension rights under both the NHS and the PCSPS and cannot understand why NHS staff should have to contribute 6% of their salary to their pension scheme whereas civil servants only contribute 1.5%. Surely contributions should be consistent across the whole of the public sector?

What I cannot stomach is the government's claims about the proposed changes being fairer
Andrew Butler
I agree with the clampdown on bogus early retirement deals on the grounds of health, especially within the police service. However, what I cannot stomach is the government's claims about the proposed changes being fairer.

If they are so good why were they rejected by judges and not even proposed for MPs? Their pension scheme is a downright luxury and they build up contributions at twice the rate of civil servants.

There will be a mass exodus from the public sector if these changes go ahead. After all, what incentive is there to work in the public sector for poverty pay and no fringe benefits?
Andrew Butler

I do not understand the idea that just because the private sector cannot deliver secure and affordable pensions then no-one should have them.

The government appears to want it both ways as usual, telling us all to save more for our pensions on the one hand and then cutting pension entitlement for a significant percentage of the working population on the other.

Between rising mortgage payments, higher taxes and the increasingly high cost of living, where exactly am I supposed to find the money to save for a pension? And who could be trusted with it anyway?
Matt Munro

I am amazed that the BBC cannot find anyone to counter the view expressed by the union spokesman on civil service pensions supporting their present final salary basis.

Final salary schemes were conceived mainly to benefit employers by rewarding loyalty
John Francis
I am now retired but was twice in final salary schemes when I was working. I regard them as grossly unfair to the average worker. Many people change jobs several times during their working lives like I did, and these people lose out.

I believe final salary schemes were conceived mainly to benefit employers by rewarding loyalty, exploiting the unfortunate fact that so many employees are not very interested in pensions in their 30s and 40s.

The union is representing the vested interests of the relatively few against the non-vocal majority. The final salary basis also has an undesirable distorting effect on salary levels in the last year or so before retirement.
John Francis

An average salary scheme is a fair compromise between a final salary and money purchase or defined contribution scheme. The risks are more equally shared between employer and employee.

Another way of rewarding promotion needs to be introduced so that the pension is nearer to final salary. This could be done in many ways such as supplementary pension schemes, employer-supported saving schemes or just extra pay.

Ministerial and MPs pensions should follow the same rules
Alan Grant
Any civil service change should be management led, that is, ministerial and MPs pensions should follow the same rules. If it is good enough for civil servants, it is good enough for MPs.
Alan Grant

The reality of this situation is that the civil service is huge and the pensions have always been perceived as totally safe.

Of course things change and since the latest share price "crash" this can only be paid for by increasing council tax. The government has already seen action being taken from disgruntled council tax payers refusing to pay more.

I think it is about time we looked at the fact that only one fifth of the population is paying council tax, and the shoddy use of public money.
Jonathan

Something must be done. Otherwise pension liabilities will break the bank, as they did in the 1970s when Harold Wilson went crawling to the IMF for a loan. We cannot afford to accept these liabilities, and it is unfair to everyone else.
David Ashton

It must be right that pension arrangements are reformed for all public workers, not just civil servants.

How can it be justified for someone who has had their own pension arrangement destroyed, to then be expected to pay for someone else have a more comfortable arrangement, and yet still continue to suffer themselves?

Politicians need to take note, as do those already in retirement. If robbing pensions can be permitted for those still contributing to the economy, then it can only be fair that those currently exempt and safeguarded arrangements should be similarly affected.
John Elton

I think the government's plans for the future of civil service pensions are fair bearing in mind the position the rest of us are in.

I think the government's plans for the future of civil service pensions are fair
Mr C.B. Sim
Having made a provision for old age in the form of a private, money purchase pension, we see falling rates for a number of reasons including government action.

When will the government start to target other employees, for example, local government, police, and so on, all of whom have a "black hole" in their schemes which the council tax payer is required to make good.
Mr C.B. Sim

Back in 1983, when I joined the civil service, it was a respected career, with good prospects, salaries were considered to be reasonable, and there was a decent pension from a grateful nation for selfless service.

Over the years, I have seen career development vanish and pay eroded by below-inflation pay deals, owing to Treasury pay caps.

In fact, I am now at the situation where, despite perfectly acceptable performance, I have had no increase in salary for nearly three years. I have put up with this since I knew that at least my pension would be ok.

No Longer, so it seems.

Not content with destroying any hopes of a worthwhile career, this government is intent on destroying my future
Colin Taylor

I have spent 30 years planning for my retirement at the age of 60 in 2015, when I will have given this country for 41 years of loyal service.

This proposal is an infringement of my human rights given the terms I was employed with in 1974
Mike Weston
Now this government thinks it can move the goal posts.

Well I believe this proposal is an infringement of my human rights given the terms I was employed with in 1974. What this government is proposing is no different to what Dick Turpin did in the 1700s.
Mike Weston

I can understand the public sector workers squirming now that something is finally going to be done about their very lavish benefits. But to hear all the justifications for such generous pensions is ridiculous.

The holiday entitlement is very generous, not to mention the sickness benefits, jobs are secure, pensions are unbelievably generous and paid for mainly by tax-payers (who often have been laid off and have no pension).

And what is wrong with retirement being 65, same as for everyone else? Also, this business about "not keeping up with inflation", what does that mean?

The inflation measure anyway is just an arbitrary figure. Jobs in the private sector go simply by supply and demand. It is high time some balance was imposed.
Mary Kapadia

It is time for civil servants to come into the real world and face the same pressures as the rest of the working population
Tony
I think the move to alter the pension benefits for civil servants is a good thing. There is no actual funding for this scheme which is done under a notional basis. As such, tax-payers are being called upon to underwrite them.

It is time for civil servants to come into the real world and face the same pressures as the rest of the working population.
Tony

The proposed pension changes would only be fair if civil service salaries, which are notoriously low, were raised so as to be equated with those in the wider industry.
Dave Bracey

As a former civil servant who was forcibly transferred to the private sector some years ago, I am horrified at the betrayal of civil servants.

It is only a matter of time until the private sector employers of former civil servants follow suit.

We have consistently been given pay rises of less than the rate of inflation and less than the prevailing market rate
Peter
The media choose to overlook the fact that we have consistently been given pay rises of less than the rate of inflation and less than the prevailing market rate, even through the boom years of the 80s and early 90s.

The excuses always given for this are a) job security and b) the value of the pension.

The government is taking both of these away, but I do not imagine they will retrospectively review the drop in value of pay over the last 20 years. And the suggestion that this will not save the exchequer any money is untrue.

Nurses, doctors, policemen, watch out. You are next. The only ones to escape this attack will be MPs and judges.
Peter

As a civil servant I find it quite insulting to be told I now have the "right" to work until 65.

How does a pension based on the average salary mean a better deal than the pension based on a salary when you finish your career? And how is it fairer?

Until now I had resisted union membership, but this issue has made me reconsider that position
Matthew Izzard
Another insult is to be told that we cannot see the actual calculations until after the decision point, so we are being asked to make a decision without any of the facts upon which to base it.

Personally, until now I had resisted union membership, but this issue has made me reconsider that position.

The pension was one of the factors in my choosing this career over a better paid career in the private sector. To lose those rights now would be incredibly unfair.
Matthew Izzard

During my husband's civil service career there have been either no, or minimal pay rises, particularly during the Thatcher years.

And now we find that he could not move out of the civil service to the private sector as he is thought to be institutionalised.

As he is 49 years old, these changes are going to affect him and our plans.
Frances Fisher

I am a nurse, working within the NHS, and I would welcome the changes that are proposed for the civil service.

I do not want to work full-time until I retire, but to get a decent final salary pension that is what you have to do.

I would welcome the changes that are proposed for the civil service
Pam Southcombe
What a lot of nurses do is retire early, and then start again with a new NHS contract so they can work part-time.

Plus I contribute to my pension, the civil servants contribute very little!
Pam Southcombe

As an NHS hospital consultant I am in no doubt that the civil service model will be applied to the current NHS pension arrangements.

The effect will be to drive many relatively senior consultants out of the NHS, because although we are now well paid, our salaries throughout a long training were low.

Were my pension to be based on career average earnings then it would be more than halved.

I will have to leave the NHS the day before these new arrangements become operational
Dr Simon Bricker
I will therefore have to leave the NHS the day before these new arrangements become operational.

I will also feel that a deception has been practised, because I have worked for many years in a service that has been both wracked and wrecked by endless political posturing and interference. And I put up with this partly because the generous final salary pension scheme has been too generous to forego.

Had the arrangements been different than I might have left long ago for a more comfortable, placid, and well-remunerated life in the independent sector.
Dr Simon Bricker

You constantly fail to mention that civil service wages are kept low to help pay for the pension.

When Margaret Thatcher came to power in 1979, she was determined to break up the civil service pension scheme.

The argument that the new scheme robs the rich to pay the poor is just not borne out by the numbers
Robert Day
Since then the pensions market has changed. But are we really saying that because private pensions are now dubious because of mis-selling, poor investment performance and bad pension management decisions, then the public sector schemes should follow suit?

The argument that the new scheme robs the rich to pay the poor is just not borne out by the numbers.

The numbers of senior civil servants are miniscule compared with the vast, underpaid clerical army that actually collects taxes and pays benefits. They will not see any real gains.

And the government's own studies such as the long-term study of civil service health, suggests that raising the pension age will result in massive savings as many low-paid civil servants will probably only collect their pensions for a couple of years anyway.
Robert Day

The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.

The BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide.




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SEE ALSO:
Public sector pension upheaval
10 Dec 04 |  Moneybox
Strike threat over pension plans
06 Dec 04 |  UK Politics


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