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ingermany

Going Greek. UK Government Pensions

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I have just noticed that my UK military pension has had its inflation linked annual increase reset to 1%. RPI linkage was promised, and it was part of the package that enabled UK to recruit military personnel to serve in Iraq and Afghanistan. Seems that those pension commitments are being gradually eroded. Government seems to have decided that a quiet stab in the back for military pensioners is a good place to start. I agree it is probably as good a place as any. What surprises me is that it has been done without debate, discussion or protest. Strange that they still have cash to splash on propping up house prices though, but I expect when the government's huge gamble on entering the home loans and mortgage market finally collapses, pensions and wages across the public sector will become even more unsupportable. Armed forces, police, hospitals, schools anyone? 

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If I remember correctly, indexation was changed from RPI to CPI in the emergency budget of June 2010, so it took effect in April 2011 presumably. And the CPI figure used is the previous September. Therefore September 2016, CPI = 1.0% hence your April 2017 increase. You are 6 years too late in shouting.

https://forcespensionsociety.org/news/consumer-price-index/

By the way, if you were going Greek, that 1% increase would have been a 20% reduction this year and again next year and probably some time in the future again after that.

Edited by EmmaRoid

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I heard that we only make the 2% of GDP target set by Nato because of how much we spend on military pensions...

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16 hours ago, scottbeard said:

I think like all public sector pensions it moved a while ago from RPI to CPI, which just happened to be 1% this year.

 

 

Oh...shows how much attention I pay to this.....I must have missed that. For 5 years. How the chuff can they calculate inflation as 1%? 

Pensions are unaffordable though, and there has got to be a default on a whole lot of government debts, including pensions. 

Or more currency devaluation and inflation. 

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15 hours ago, Wayward said:

I heard that we only make the 2% of GDP target set by Nato because of how much we spend on military pensions...

There are more massive defence cuts coming. And yes, I believe the pension liabilities are included in the military budget. Remember those massive forces we had in the Cold War? We're still paying them from today's defence spending. I do wonder how long we can keep this up for. 

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1 minute ago, hotairmail said:

Yet student loans are set at RPI + 3%.

That is quasi criminal behaviour when government costs are set at CPI and people's costs are set at RPI.

 

Student finance is just downright state sponsored theft. Help to Buy gifted loans to estate agents and house builders....interest free.  Yet if you want to train to be a doctor it's RPI +3%. 

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3 hours ago, ingermany said:

Student finance is just downright state sponsored theft. Help to Buy gifted loans to estate agents and house builders....interest free.  Yet if you want to train to be a doctor it's RPI +3%. 

yes...be in no doubt about our priorities...the first priority of government now is to ensure the rich get wealthier year on year through HPI

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On 12/05/2017 at 9:22 AM, hotairmail said:

Yet student loans are set at RPI + 3%.

That is quasi criminal behaviour when government costs are set at CPI and people's costs are set at RPI.

 

The worse thing about the student loans, certainly that I know of personally, they were taken out basically between an individual and the government through a company they setup for purpose.  They never gave any indication that they would or could sell the debt to some other private enterprise.  At the time people were offering private loans to students when I was at college and I avoided them like the plague.  Later on them changing the terms where when you're 65 and still haven't paid it, its written off, that's not the deal they offered at my time, they wouldn't change those terms for me so why change the creditor which is still as far as I was concerned, part of the deal.

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29 minutes ago, janch said:

BOE (Bank of England) pensions are RPI linked.........what a surprise!

They are fully funded with index linked Gilts.

You might want to remember that when they had the d1ckhead going on about lowering IRs so that businesses would invest.

There should be no BoE or Treasury/civil service pensions. They should be given the 10%, with 5% from the government , and told to find their own, fully at risk pensions, like Joe Public.

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