News Archive - June 2011
We're all in this together
17/06/2011
Teachers and public sector workers are likely to start strike action due to unhappiness about cuts to their final salary pensions. As I have mentioned before, public sector pensions are far more generous than money purchase private sector schemes, due to the fact that all investment risk is borne by the state. The cost of these schemes really is unsustainable, and this was the case even before the financial crisis and its fallout.
The planned changes are framed to avoid penalising the lowest paid public sector workers, but the cuts are still being portrayed by the unions as a political rather than an economic decision. Believe me, there are plenty of public sector 'fat cats' who will suffer significantly lower pensions as a result of the changes. It's not only bankers who have six figure salaries and huge pensions. I always feel that those with public sector pensions (or indeed anybody who is lucky enough to have a final salary pension) have no idea how much worse off their private sector colleagues are when it comes to retirement income. As for millions of people retiring at 60 on a full pension - with everyone living for longer, this really is unaffordable.
Everybody is suffering at the moment and I fail to see how strike action will help.
Please call Mulberry Financial in Macclesfield if you would like to discuss your pension options.
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