Big day coming up

This conversation appeared on my Facebook page today in response to a posting of a Telegraph article urging the Government to get stuck into unfunded public pensions.

I’m not saying this is the kind of conversation that is going on in pubs and over weekend bar-b-q’s …but it certainly gives a different perspective!


All of which indicates that the private sector is a hugely inefficient provider of pensions The State on the other hand is uniquely placed to provide pensions efficiently. The huge advantage for the State is that it has the use of members’ money interest free for the whole period up to payment of the pension

 I agree..level up not dumb down though we will have to accept pain on both sides.
A lot of the state pension money is invested in BP.I wonder if they are worried?

Interestingly, our’s isnt actually invested. Our deductions (currently £300+ pcm) are paid straight out as pensions
Yes that’s the whole point Cos many public sector pensions are not funded in advance, we don’t waste money on fund managers, their dreadful stock picks, their client parties, their pr efforts, their overpriced suits etc! (now surely that will get a response from a manager!)
Well said , and if we hadn’t wasted the last ten years on stakeholder pensions,NEST and all the other funded hoopla…and instead got on with building a proper SERPS or S2P, we could have done an awful lot better. ”


Over the next few years most of us are going to pay a lot more in tax and NI to support unfunded pensions  than we pay into our own funded pensions.
Unfunded pension liabilities for second tier pensions are variously estimated at between £700bn and £1200bn with best guesses coming in at £1000bn. That doesn’t take into account the unfunded SERPS/S2P promise.
So in a macro sense unfunded pension liabilities matter rather more than funded pensions and it’s about time we had a proper debate on this country’s total retirement provision.
Which is why the establishment of an independent commission on pensions is important and why that commission should focus on a national strategy for retirement savings that concentrates on best outcomes for all our current and future pensioners.
I hope that the debate rises above the usual vested interests and considers the really big issues- inter-generational transfer, coping with demographic change, the pensions apartheid between private and public sector, getting the poorest out of means tested pension benefits.
Tomorrow’s budget is certain to be painful and it will in the short term hurt the “pensions industry” . There are however significant signs that Government is finally willing to address the big issues for which, in the longer term, we should be grateful. 
I hope that we’ll see more debates like the one I found on Facebook .

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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1 Response to Big day coming up

  1. Interesting PoV but can’t agree. Would you like to sue the government for bad advice and messing up pensions and financial regulation? Competition? Alternative providers? Is this just a wind up from Trade Union vested interests?

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