11/07/14You can’t touch that!
Hello!
This week my thoughts were focussed on the strike that went ahead on Thursday. Unauthorised or not, it got me thinking as to why people would strike-& include changes to pensions as a reason to. Now don’t get me wrong, I’m all for democracy and if someone feels strongly enough that all aspects of negotiation are futile and to strike is the only way, then so be it.
But…..I do find it difficult when the strike includes ‘changes to pension’. We are about to see some of the biggest legislative changes in pension history. One potential change alone allows someone to access their whole pension fund in its entirety-what’s wrong with that and why strike about it? we see that the vast majority of public sector workers are exposed to either Final Salary Pensions (aka defined benefit) or high level Money Purchase pensions (aka defined contribution) schemes, if the Final Salary scheme is closed to new members (unlikely, but worth noting). In some instances a Final Salary scheme could cost an employer 20%-30% of an employee’s salary per year to run, whereas a Money Purchase scheme might cost an employer 15-18% of an employee’s salary each year. That’s a huge shift from the Private sector, where virtually all but a few are in Money Purchase schemes, receiving larger contributions from those working in larger organisations, Multinationals, Banks, etc, let alone those working for private companies or individuals…so, when compared to others, the Public sector pension regime looks too good to strike about..doesn’t it?
I get the issue on pay. receiving 1% salary increases, being asked to work longer hours for the same money will increase stress levels within the work environment & I’m sure work is also brought home too-even if its to rant about ‘what a day I’ve had’ but isn’t this compensated by aforementioned pension contributions? these guys will eventually retire on up to two thirds of their final salary..will you?
Now..I’ll tell you a brief story…I worked for a bank for 17 years and I was lucky enough to have a Final Salary pension. I also saw zero per cent salary increases for around 6 years. I saw my bonus structure change, meaning I had to do more business, for less money. I also had my retirement age changed on my pension, from 55 to 60 meaning I had to work more years to get the same level of pension. Unite/Unison were enraged, we should strike..& some did. I didn’t strike, because I didn’t think my voice wouldn’t change anything, however, it did make me stop and thing and eventually it became one of the myriad of reasons I left & set up my own business, but I digress…..
I was working with people who had been at the bank since they were 16 years old and were now 50. They spent more time at the Bank than with their partners and children!!!
I was orphaned while at the bank, I was married, 3 times a father and divorced whilst at the bank..the security of income and a fantastic pension was the reason the majority of people I came into contact with stayed at the bank. To alter what was fundamental to their life (I wasn’t the only one divorced due to work overload and bringing all the days issues home with me), their reason for staying, enduring the workload, having time off with stress etc, etc, was the benefits & when you mess with benefits, you are shifting Teutonic plates because the sacrifices made to and by husbands, wives & families were and are brought into sharp focus and that’s why I think the changes to work & pensions causes such action. Not the change per se, but the emotion it brings…As I say, You can’t touch that, its potentially Pandora’s Box.
Now some reading this will say that I’m out of my depth as I’m no analyst and I agree, but, I have an opinion and as we are a democracy……….!!!!!!!
Have a great weekend and I hope you can switch off mobile data and enjoy it
Victor
