Are Cameron and Clegg planning to slash military pensions?

Discussion in 'Armed Forces Pension Scheme' started by nigegilb, Jun 15, 2010.

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  1. I am struck by the blunt language being used to describe the burden of public sector pensions. Clegg mentioned the retirement age (60) and compared it to the private sector retirement age of 65 plus. In the same breath he talked about gold plated pensions no longer affordable.

    Is the Govt planning to retrospectively slash pensions for public sector workers, including the armed forces, ignoring the fact that very few people have made alternative arrangements for their pension?

    I am in receipt of an armed forces pension, I am getting concerned that this bunch of wealth grabbers are after my retirement pot. Bit rich considering they have the most generous pension in the country. But it is the highly unjust retrospective element that is concerning me the most.
  2. Probably.

    I don't think anyone cares as long as someone apparently getting a better deal than them gets a kicking.

    All of those public sector spongers retiring from their gold-plated jobs as bin men and private soldiers should suffer like the rest of us private sector consultants etc. and live off beans and fresh air in their old age. After all, its only fair that everyone should get the same (crap) deal.

    [please check irony filter settings before replying to this post]
  3. I don’t think they can change it retrospectively as it was part of out terms and Conditions of Service but I’m sure all the new ones they can and will. The old lot changed some of the new ones already in 2005 I think.
  4. That is exactly how I see it TM. I now work in the private sector, my pension fund is being taxed, thanks to Gordon and the nice LibDems were coming after my high income tax relief with their manifesto at the last election.

    How the bloody hell are you supposed to avoid eating dog food in retirement?

    I would like to think they can't come after me retrospectively, in which case Cameron and Clegg are being highly irresponsible by not providing a narrative to their public rantings. Retrospective legislation was actually carried out by Brown and his socialist mob, are we returning to the bad old days so soon?
  5. My Mil pension has already lost more than 30% of it's value due to piss-poor exchange rate in the last 2 years. If it gets much worse I'll have to come home & become a pikey!
  6. I think you are all being a bit fragile. It would take an act of parliament to change any of the provisions of AFPS 75 ; I don't think they would get it through the House of Lords (lots of military pensioners there). And we will all fall off the pensions bill pretty soon anyway.

    I think you will find that the amount the government pays into present and future pension schemes will be reduced, reductions will not apply to us but will to present and future civil servants and service personnel will be expected to contribute more. It will be interesting to see how they relate this to the present "7%" abatement in military salaries which allegedly pays for pensions......

    Those who elected to change to the new Army Pension Scheme will find that there is a legal provision for the government to alter it as they see fit, and they have done so about 13 times since it was introduced.
  7. I hope you are right, but Clegg was definitely talking in the present tense. I have fired off an undiplomatic email to Dave's new office. If I get a reply I'll post it up.

    From DT;

    The OBR report and Clegg's comments are undoubtedly designed to soften the public up for potentially unpopular decisions further down the line. At the same time, however, the government knows that there is widespread anger about the pension apartheid that has opened up over the past two decades, particularly between the public and private sectors and between older and younger generations.

    Some reform of public sector pensions is therefore now considered inevitable; the question is how radical the government dares to be.

    On the one hand it might decide to tinker around the edges, perhaps asking some public sector workers to contribute a little more and others to accept more modest benefits. New joiners would be hardest hit. Such an approach would be fiercely resisted by union leaders in public, but would probably be privately accepted as the best outcome possible in the current economic circumstances.

    Alternatively the government might decide that this is the moment for root-and-branch reform of the pension system, and that current PAYG schemes should be abolished entirely. It might even go further and ask existing members to share in the financial pain being felt in the private sector, arguing that past promises cannot now be fulfilled.

    Such a radical approach would be met with fury by public unions and their members, and might yet lead to the kind of industrial action not seen since the 1980s.

    If this really is a radical government intent on radical restructuring of the public sector, then it might decide to make fundamental reform of public sector pensions one of its flagship policies.

    The next stage will be a major review of public sector pensions, likely to be announced in next week’s budget. That will only defer the real decision, however: ultimately the government will have to decide whether it is has the mandate and/ or the stomach to take on the unions in what could be an almighty scrap.
  8. Alsacien

    Alsacien LE Moderator

    I don't believe it is well known, but if you are not in actual receipt of your pension (and maybe even if you are), it is possible to transfer your pot aboard.
    My German pension fund manager negotiated this with Glasgow in 2003. The pot was not huge, and I had to leave a nominal amount of 1277 in there for some odd reason, but the rest they transferred after a couple of months of paper exchange.
    I had to make a declaration to the effect that I did not intend to return to the UK in the foreseeable future - of course if I did I would only be entitled to a state pension, and that was it.
    I don't know the full scope of this, but I got the impression they were quite happy to offload future commitment in principle, as long as you were a confirmed long term ex-pat.
  9. Don't you have to be paying into a qualifying pension abroad for a minimum of two years before you can do this? Or did you do it straight away?
  10. I don't think there would be very much public support for anyone pulling down a pension in excess of £80K pa.

    Capping pensions might save a pretty penny for little political pain.
  11. And bringing the public sector (civil service, local government employees) up to the standard retirement age in the private sector. But I think that may be too painful a nettle for them to grasp?
  12. Alsacien

    Alsacien LE Moderator

    I had the scheme going for a few years already at that point and had just transferred it from Switzerland, so cannot say. It would make sense though, you could not make a strong case as a long term ex-pat without some time in.

    In retrospect it was an excellent deal - the scheme performed fantastic until 2008 and gave a massive return. The last couple of years being more cautious of course.

    Found a link:
  13. Hasnt this already happened ??

    According to the old man after his service years in the crabs he was meant to get a lump sum and pension start at 60

    He is now 63 and no lump + his pension now starts at 65 :x .
  14. seaweed

    seaweed LE Book Reviewer

    A lot of the noise about senior CS pay & pensions etc is got up to take the spotlight off MP's rackets, fiddling and general soaking of the taxpayer, and transfer the hate onto the CS who can't answer back. Armed Forces are caught up in this by default. Next CDS will be on a cut rate I think but with a vastly more difficult job as he runs and then has to implement SDR.
  15. If you start by saying the disparity between Private versus Public sector pensions will be evened up then any changes to public sector pensions will be as with the private sector i.e. pensions legislation means changes cannot be retrospective.

    All accrued benefits remain as they are and things just get crappier from a given date in terms of such things as employee contribution level or accrual rate of benefits: but the pensionable date can change as can inflation increases.

    Contrary to the belief of many, as long as the employer is acting within the terms of the pensions acts and follows procedure there is virtually nothing to stop this.

    Also worth noting that private sector final salary pensions scheme are going to die out soon thanks in large part to Gordon Brown. His parting gift was in the form of Schedule 12 to the Finance Act 2010, that was subject to no worthwhile debate and was stuffed through pre election.

    Many people have yet to even begin to understand the full horror of what that means for them in practical terms if they are in the upper pay bands.