Former civil servants, teachers and NHS staff are expected to get a 10pc increase in payments from their final salary schemes, equal to an average £1,000 a year. This will be paid in addition to a £1,000 increase in the state pension.
It comes after the Government pleaded for working people to accept a real terms pay cut to prevent price rises from spiralling out of control.
Ministers earlier this week confirmed the return of the “triple lock” for state pensions, meaning they will increase by September’s inflation figure, which the Bank of England expects to be around 10pc.
The Government is legally required to increase public sector pensions by the same amount as benefits.
Because they’re also just changed the calculation for RPI on inflation protected bonds. You know, the way that private sector pensions try to beat inflation.
Hmm? Yes of course the calculation change screws creditors, you’d not expect anything else now, would you?
I remember having a cutting from the Evening Standard around the late eighties / early nineties mark of an article by their economics editor about so-called ‘wage driven inflation’. It contained a quote from a former No. 10 adviser (may have been Alan Walters but not sure) who stated that rises in wages do not in themselves lead to inflation, inflation is a general rise in prices, not a rise in one sector or another.
Stuff goes up and down in price all the time, but it seems to me that it is only Government that can engineer the price of virtually everything going up at the same time.
I’m so old I can remember ‘prices and incomes’ in the 1960s.
Enoch Powell: “The politicians, and only the politicians, are responsible for inflation”.
Nineteen sixty nine.
“The Government is legally required to increase public sector pensions by the same amount as benefits.”
As the recipient of a £6.5k a year civil service pension from my 10 years’ service with the Inland Revenue (as it was back then) in the 80s/90s I think this is jolly good news and I thoroughly deserve it. Particularly as the scheme I was in was non-contributory (apart from some ‘family related’ element which I was refunded when I started taking my pension at 55 as I was single at the time).
Andrew C
I wonder if the Sage of Ely will be up in arms over this – I won’t hold my breath!
I do think your contributions on here (especially related to Spud) have more than earned that rise as well….
Government debt and unfunded pension liabilities now are twice GDP. I wonder who will pay?
In normal times we could expect this proportion to decline gently over time. Not with net zero we can’t.
It comes after the Government pleaded for working people to accept a real terms pay cut to prevent price rises from spiralling out of control.
Amazingly, suggesting working people should swallow increased costs (not govt depts, businesses, etc) has turned out to be an unpopular approach.
Note to Boris:
Sometimes you’d best use Vaseline.
Otherwise you can hurt yourself when doing the shafting…
“they’re also just changed the calculation for RPI”: really? Has the court case already had an outcome?
That would be unusually quick.
For anyone interested… public sector pensions increase in payment in line with the previous September CPI, with no cap. Increases on private sector pensions are almost universally capped – usually a maximum of 5%pa, although could be lower or even increase only at the trustee’s discretion. So private sector pensioners are doubly screwed.
I sooo hope that there are a couple of referenda in early 2023 on whether to increase the Council Tax by more than 5%. Any increase less than that doesn’t require a public vote.
This would help settle a prediction made by Dr Kristian Niemietz (pbuh for he’s a good ‘un) that the virtuous and performative British would actually vote for tax rises if asked, rather than the Swiss for example who consistently vote down tax rises when asked.
Now we know why Gov’t doesn’t want to increase publivc’s pension by a couple of ponds a week. It’s because public sector pension increases would dwarf that spending
Lord Haw Haw: ~£320 per day to snooze in HoL
State Pension ~£150 per week
‘rather than the Swiss for example who consistently vote down tax rises when asked.’
The noble government of Queensland was elected on a promise of ‘No rise in taxes.’ I’ll let you guess what’s just happened.
@KyleT: A private sector defined-benefit pension? How quaint!
While it may be popular to bash public servants, just remember that civil servants have gone through a decade of “austerity” (=below inflation pay rises), and more recently we had a “pay pause” (=”pay freeze”, = real terms pay cut), and this year a treasury imposed limit which is also well below inflation.
In many parts of the civil service the pay is so poor relative to the private sector that we struggle to recruit and retain staff. Yes, there are some compensatory benefits, but even taking those into account, the deal is getting steadily worse.
Of course, with the announcement that 20% of us are to go without any discussion as to what tasks the government does want doing any more, many who are nearing retirement are looking for a voluntary early retirement scheme – and when they go, so does their experience and knowledge. As well as problems recruiting and retaining staff, in some areas there’s a demographic time bomb ticking away as there’s been a lack of junior staff recruitment and development.
@Anonymouse Cowherd, I see your decade of below inflation payrises and raise NO payrise for 10 years.
The difference? That was my fault for not changing jobs quicker.