Pension LTA under threat?

[Gary C]

Dixy said:

Good luck with that. Despite being Public sector the NHS pension scheme falls into this trap which is why the waiting list is now 5 million and counting. Most consultants are unwilling to work overtime and weekends when expected to pay for the privilege of doing so.

I thought that was due to the pension input amount not the LTA ?

[NickCQ]

Biglips said:

My eldest is doing medicine. She has seen the reality and still wants to do it.

Good for her

[Royal Jelly]

NickCQ said:

It's OK, we're impressed how rich you are, but if you define having 2x the national median income without having to work as a "reasonable existence"... you need to spend more time in the real world.

Do you think 35k is lavish, or a ‘rich’ person’s existence?

It’s also not anywhere near twice the median income. It’s 20% higher (£29,400).

Far too many have-nots want to drag others down to their level. What justification do you have for limiting a retirement pot’s size? That you don’t have it so others shouldn’t, either?

[Royal Jelly]

NickCQ said:

Which is it?

Very astute. I think you caught my drift. If your comprehension is as poor as you’re pretending; the hard-saved cash is what then gets invested.

Edited by Royal Jelly on Thursday 24th June 16:56

[NickCQ]

Royal Jelly said:

Do you think 35k is lavish, or a ‘rich’ person’s existence? It’s also not anywhere near twice the median income. It’s 20% higher (£29,400).

Far too many have-nots want to drag others down to their level. What justification do you have for limiting a retirement pot’s size? That you don’t have it so others shouldn’t, either?

Your calculation neglects both tax-free cash (25%) and the State pension. When you factor those in, you can see how on a net basis a £1 mm pot can deliver monthly cashflow roughly double median national income. More if you withdraw at a higher rate.

As regards the second point, the justification is about equitable raising of tax revenue. It seems regressive to me to give middle earners uncapped shelter on capital gains in their pension pots.

[markiii]

you really can't include the state pension in what your definition of what a £1m pot delivers thats just rubbish

[NickCQ]

markiii said:

you really can't include the state pension in what your definition of what a £1m pot delivers thats just rubbish

The discussion was whether you can have a "reasonable" standard of living in retirement with a £1 mm pension pot. That requires an analysis of your expected net monthly cash flow, which obviously is going to include the State pension.

[Jawls]

anonymous said:

[redacted]

Because the government wants people to save money into pensions, so that they’re less likely to become a burden on the state. Forcing people to do very aggressive tax planning makes this less attractive.

I’m open to the view that pension tax relief ought be limited (I’d be fine with a flat 30% rate etc, and the annual 40k limit). But the way it’s done with the LTA is just needlessly complex and requires people to do far too much modelling. Especially when the limits change downwards many times in a decade when the nature of pensions requires very long term planning.

[jrock78]

anonymous said:

[redacted]

Hardly lavish. generous yes, deserved probably. But yes tax payers should fund NHS pension retirement unless you want it to go private and then trust me you will be paying a hell of a lot more when you get ill and need to be seen.

[Gary C]

thesyn said:

anonymous said:

[redacted]

I think the point being made is that more senior people in any high stress profession when they reach the 'fag end' of their working lives look more carefully at what is important to them and if there is insufficient motivation available will decline extra work.

While the lower paid might not have much sympathy, for me the issue is the shafting of expectations.

You work 40 years with an expectation of a standard of retirement, which forms part of your 'deal' for working, then to have it reduced just as you are about to retire is unfair. It should not be applied retrospectively when there is no opportunity to adjust either financially or mentally.

If this comes in, I wonder if there will be a function to hold at the higher amount for those who have already exceeded it as was possible previously.

The whole tax system is distorted by the left/right income tax slagging meaning no gov has been brave enough to increase income tax rates for years and ends up pissing about with stealth taxes and tapered allowances.

Ah well, my pension transfer amount from my DB scheme was recently valued at £2.4M so i probably shouldn't care

[NickCQ]

Changing pension policy is a bit like the old proverb about planting trees. "The best time to do it was 20 years ago. The second-best time is now." Just wear a flak jacket in case you meet any WASPI women on the way home

[Gary C]

NickCQ said:

Changing pension policy is a bit like the old proverb about planting trees. "The best time to do it was 20 years ago. The second-best time is now." Just wear a flak jacket in case you meet any WASPI women on the way home

[Dixy]

NickCQ said:

Junior doctors today do the same job (potentially worse) for much less money and no chance of a million quid pension pot at the end of it. They will also work more hours and more antisocial hours far longer into their career with a greater chance of being shunted around the country away from family and friends. I have huge sympathy for junior and mid-level NHS staff but relatively little for the top of the pile.

Who do you think trains a junior doctor so they can become a consultant. Choice, train an st5 and get screwed by the tax man. Work extra weekend shifts to reduce the 5 million on the waiting list and get screwed by the tax man. Or take your Moody out in the Solent.

[Dixy]

anonymous said:

[redacted]

Perhaps you would like to explain to this stupid old man.

[NickCQ]

Dixy said:

Who do you think trains a junior doctor so they can become a consultant. Choice, train an st5 and get screwed by the tax man. Work extra weekend shifts to reduce the 5 million on the waiting list and get screwed by the tax man. Or take your Moody out in the Solent.

The point I was making is that it's unlikely that today's vintage of junior doctors will own yachts or have million quid pension pots (adjusted for inflation) when they are in their 50s / 60s.

[Dixy]

Well they certainly wont if they don't get the training needed to become consultants and we ordinary people wont get the health care we will need.

[brickwall]

I have never understood why the public sector doesn’t advertise the value of its pension scheme more - or indeed offer individuals the option to opt-out and take the cash instead.

Loads of private sector jobs advertise on the basis of “Package worth up to £80k” when in fact this is £70k salary plus pension and healthcare.

If the public sector did the same it could add 25% (or more) to the headline basic salary - which might be very helpful for recruitment.

A junior doctor could choose between (say)
- £40k salary and accrue entitlement in the the DB scheme
- £50k salary and have 4% employer contributions to DC scheme
Some may value the pension, some may value the extra salary (and the mortgage power it brings). Horses for courses.

[95JO]

brickwall said:

I have never understood why the public sector doesn’t advertise the value of its pension scheme more - or indeed offer individuals the option to opt-out and take the cash instead.

Loads of private sector jobs advertise on the basis of “Package worth up to £80k” when in fact this is £70k salary plus pension and healthcare.

If the public sector did the same it could add 25% (or more) to the headline basic salary - which might be very helpful for recruitment.

A junior doctor could choose between (say)
- £40k salary and accrue entitlement in the the DB scheme
- £50k salary and have 4% employer contributions to DC scheme
Some may value the pension, some may value the extra salary (and the mortgage power it brings). Horses for courses.

A couple of Government Department’s adopted this approach recently, DWP created “BPDTS Ltd” and HMRC created “RCDTS Ltd” to attract talent in the IT sector as the traditional Civil Service pay bands wouldn’t stretch far enough.

For example: Senior Software Engineer in Civil Service is typically Grade 7 which is £48-£58k with the Civil Service pension (~5.45% employee contribution, 28% employer contribution) - BPDTS/RCDTS offer £55k-£72k with a DC scheme (5% employee contribution, 10% employer contribution).

I worked inside the Civil Service in both DWP/HMRC and more recently in one of their Ltd companies, unfortunately it’s coming to an end and we’re being TUPE’d back in… It works in my favour of course but it’s back to square one for attracting young, talented people…

Like you say, it should be a permanent option for all Public Sector organisations with a DB pension scheme.

[gangzoom]

brickwall said:

If the public sector did the same it could add 25% (or more) to the headline basic salary - which might be very helpful for recruitment.

For UK trained doctors pay is not an incentive for recruitment. You can get roughly a 40% pay uplift for doing oncall/anti social hours, but its the first thing many junior doctors are keen drop if given the chance.

Large numbers of doctors are all now less than full time, both male and female, overall the work force values personal time away from work much more than pay.

[gangzoom]

NickCQ said:

Junior doctors today do the same job (potentially worse) for much less money and no chance of a million quid pension pot at the end of it. They will also work more hours and more antisocial hours far longer into their career with a greater chance of being shunted around the country away from family and friends. I have huge sympathy for junior and mid-level NHS staff but relatively little for the top of the pile.

As someone has already mentioned your views are 100% out dated.

As a junior doctor I did shifts with 7 nights oncall in a row, 1 day off than 7 days back on days oncall. Often I was the only doctor around, and the one time I called a consultant for help at 1am he just told me to get on with it and put the phone down. But I did get paid 80% additional pay lift for the extra hours, and I was young/single so what else was I going to do with my time??

I also did a 1 in 2 24hr oncall rota for about 2 weeks till one day I realised I had no idea what day of the week it was. At the time no one bated an eye lid, it was what you did. A 12 hr night shift than off to clinic till lunch time, stagger home for some sleep, and back in at 9pm for another 12 hr night shift, its what ever one did.

Luckily for junior doctors those hours are long gone, infact we try and encourage them to report formally any days they have to stay beyond 5pm.

The most senior consultants in our department did even longer hours than me as a junior, so it no susprise no one senior has any interest in giving up more of our lives to the NHS for doing even more additional work especially with added marginal tax rates. Would you give up family weekend time for extra shifts knowing its a 50%+ tax bill? Especially when you have spent the 'best years' of your life in hospitals already for the best part of a couple of decades?

The focus on ensuring a good work life balance for all staff is rightfully more important these days.

I still tell everyone I work with its the best job ever, the fact I get paid to do what I do is amazing. But if you are purely after earning money, you will hate medicine as a career.

Edited by gangzoom on Friday 25th June 06:35