While we're talking tax...

The Gorse Fox notices a report from the Mail "Taxpayers face £500 increase to fund £1 trillian public sector pensions bill". He assumes that this is a bit of sensationalism by the Daily Mail, but behind it lies a modicum of truth.

It would appear that there's a £1Tn hole in the public sector pension fund.

Now, a quick history lesson. There have been massive holes in private sector pension funds also. As a result workers in the private sector (let's call them wealth creators) have had their pensions curtailed or converted to less beneficial plans, and may be expected to work longer. Not only have the pension funds been found wanting, but to make matter worse Gordon Brown has found it a useful source of additional funding and stolen an additional £7Bn a year from those funds.

Back to the public sector (let's call them wealth consumers). Their pension rights kick in at 60 (5-8 years earlier), and when an attempt was made to inject some realism into their employment conditions and pensions they threw a fit and stamped their feet and the cretins in Government backed down.

What does this mean? According to the article:

That equates to a debt of £40,000 for every household in the land - or an increase in 11p on income tax for the next 25 years.


Economists said the average earner would face a tax hike of £2,000 per year over the same period to meet the liability.

Well that's another poke in the eye for wealth creators in support of parasites.

Industry experts warn of growing resentment among private sector
workers, whose retirement dreams have been shattered by the collapse in
final salary schemes, that generous benefits for their six million
public sector counterparts are effectively being underwritten by the
taxpayer.

Too damned right. A question the Gorse Fox frequently asks The Department is "how is this value for money for the taxpayer?" or interjects "I am the taxpayer who's paying for this - and I object". And the Gorse Fox thinks he's working for one of the most underfunded and responsible parts of government.

Oh, and by the way:

Each year, the Government is making new pension commitments to public sector workers worth over £40 billion, it says.

Needless to say the Government says these estimates (by the IEA) are flawed. Given the Government's mendacity over the past 10 years, the Gorse Fox knows which side the truth is more likely to lie.


Technorati Tags: Pensions, UK, Debt, Public Sector