Welcome. Proposed Pension Cuts 3 UK Debt Government says; The UK debt is the worst in living memory...
Transcript of Welcome. Proposed Pension Cuts 3 UK Debt Government says; The UK debt is the worst in living memory...
Welcome
Proposed Pension Cuts
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UK Debt
Government says;• The UK debt is the worst in living
memory
• We must all make sacrifices to get the debt paid off
George Osbourne says;• We are all in this together
Do you see George and other MP’s leading the way with sacrifices?
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UK Debt
It doesn’t get any worse than that does it
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UK Debt
The previous graph was is a small section taken from the one below but the government and some newspapers like to use it to justify the
public sector cuts the government announced BEFORE the Hutton review had been completed.
Or does it?
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• for your pay being frozen for at least 2 years despite inflation running at over 5% for the last 2 years.
That’s a £3k devaluation in wages for a FF so far!
• why you must work longer, pay more and get less pension entitlement
The only reason is political spin; to be seen to be cutting public
spending
UK Debt is NOT the reason;
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Work longer, pay more and get less• Pension up rating mechanism changed from RPI
to CPI• Contributions to rise from 2012. By 2014 a FF
will pay £350 per month
Both existing pension schemes end in 2015 and a new one introduced for everyone
which includes;
• Min. age to receive full pension will be 60 for all• Career average scheme not final salary• Regularly rising contribution rates as pension
scheme changes to “Cap n Share”
You can’t deny, it’s an attractive proposition!
Pension Cuts
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This change has already happened as it was introduced in the 2011
budget.
• Pensions are devaluing as a result of this imposition as CPI does not keep up RPI.
• This change will decrease the maximum commutation sum for a FF by approximately £10k.
• The FBU and some other public sector unions are challenging this legally. The case is scheduled to go to court in October.
RPI to CPI
April 2011
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• No public service workers pay more in contributions than the 11% FF’s already pay into the FPS
• Government wants a 3.2% rise for all* public services. This would take a FF’s contributions to 14% (£351pm), 11.7% for NFPS (£292pm), whilst many other public sector workers would still pay less than 8%
• Phased contributions; FF 14.2% up to AM’s who will pay 17%
Rise in contributions
From 2012
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Minimum Retirement age 60
rating 18-25 26-35 36-45 46-55 56-65 65+excellent > 60 > 56 > 51 > 45 > 41 > 37 good 52-60 49-56 43-51 39-45 36-41 33-37 > average 47-51 43-48 39-42 35-38 32-35 29-32 average 42-46 40-42 35-38 32-35 30-31 26-28
rating 18-25 26-35 36-45 46-55 56-65 65+excellent > 56 > 52 > 45 > 40 > 37 > 32 good 47-56 45-52 38-45 34-40 32-37 28-32 > average 42-46 39-44 34-37 31-33 28-31 25-27 average 38-41 35-38 31-33 28-30 25-27 22-24
Men Age (years)
Women Age (years)
Proposed new pension scheme
The table below shows the VO2 Max values for age and
sex
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• Current VO2 Max pass mark is 42• Few men will be able to reach the VO2
Max above age 55• Virtually no women will be able to
reach the VO2 Max above age 55
This will not be covered under ill health retirement
• Those who cannot reach the fitness standard will be sacked under capability as there are simply not enough non operation roles available to redeploy all these members
Minimum Retirement age 60
Proposed new pension scheme
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Anyone who joined the fire service after age 20 will not be
able to accrue a full pension entitlement by age 60.
Many will have to work much longer to avoid a poverty
stricken retirement, although ironically, their retirement will
be far shorter as a result.
Minimum Retirement age 60
Proposed new pension scheme
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Promotion leads to loss of pension as well as even higher rises in contributions up to an
initial rate of 17%Up rating mechanism for
average salary indexing will be CPI not RPI which means the
pension you finally receive will be vastly devalued from a final
salary equivalent.
End to final salary scheme
Proposed new pension scheme
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•This means that the employers percentage of contribution to the pensions are frozen whilst the employees contributions rise at regular intervals
•There will come a time when members of the scheme pay a higher contribution rate than the employers
Cap n’ Share
Proposed new pension scheme
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Fire Fighters are a special case
Private sector workers average around 5.2%
J ob Contribution as % of salary
Firefighter (FPS) 11%Police (Old scheme) 11%Police (New scheme) 9.50%Firefighter (NFPS) 8.50%NHS 5% - 8.5%Local government 5.5% - 7.5%Teacher 6.40%Civil servant 1.5% - 3.5%Military 0%
Public sector pensions (England,
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The FPS was reviewed and reformed in 2006
• The NFPS was introduced for new joining members in 2006
• The rest of the public sector cannot claim the same and as such we should be exempt from further changes as we’ve already modernised
It is highly likely we can force the government to rethink this second
round of cuts for FF’s but it will take more than words to do so....
Fire Fighters are a special case
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The government has concluded consultation with the TUC on its
proposed public sector pension cuts. It will now start 3 months of union specific
consultation.We must show the government we are not
prepared to roll over before they make the statutory changes to the pension schemes after the consultation period
ends.
We must all support the model resolution. The time to fight back
has arrived.
Consultation & Action
thank you