Should TFL maintenance workers get a final salary pension

Sporky

That's provavbly untrue. If you only paid in for 25 years and retired before 65 you wouldn't get your full salary as pension.

The terms are all online, there's really no need to make things up.

fields5069

Yes it'll be in fractions. 60ths or 80ths, 80ths more likely so they would get 25/80 of their final salary.

Babones

holnrew said:

Roland said:

A couple of years ago I encountered a similar strike picket as I arrived at a London mainline station. He asked the man in front of me "Will you support us in our fight against this Government?" The man replied " So you want to retire at 60, which means that I will have to pay more tax, which means that I will have to work until I'm 70? Fuck off out of my way."

Yet you wouldn't get to work if he didn't do his job.

Can of worms, that one.

mellowsun

Tfl staff are rude, ignorant and unhelpful in my experience. I escorted a blind chap to St Pancras once and the information staff person there was reluctant to help him get where he needed to be - she wouldn't even look at him or talk to him, she would only talk to me. I was livid.

crunchman

Chalky said:

A maintenance worker joins TFL at 30, retires at 55 on FSP.  25 years working and his life expectancy is another 25 years.  So that pension scheme is like contributing more than half his pay packet to his pension from the day he started.  There is no way that is affordable long term, except by commuters paying for it.

As @Sporky said this is completely wrong.  If you retire at 55 you will lose a chunk of it.

Also, you don't get half your pay after 25 years.  It's a 1/60 scheme not 1/50.

Anyone who joined after 2006 can't retire at 55 at all.  The earliest you can take it is 60.

The scheme is currently extremely generous and I'm sure that there will be further changes at some point - most likely a move to average salary instead of final salary.

Nitefly

How did the designers of these schemes ever think they would be able to afford them?

Sporky

Nitefly said:

How did the designers of these schemes ever think they would be able to afford them?

They didn't reckon on later management deciding not to pay in.

When I was at Arup they had (and still do as far as I know) a final salary scheme that was entirely internally funded. But the company is held in trust for the employees, they don't have to pander to investors wanting to rob the pension fund for dividends.

fields5069

Jesus Christ! A 60ths scheme in the 21st century?

Fretwired

Blame Gordon Brown. He ruined the pensions of millions of hard working people with his excessive taxes. As for the RMT good luck if they can get away with it  - weak negotiators from TfL. The government won't bail them out so fares will have to rise. And if you commute be wary as the mayor wants TfL wants to take over train routes into London next - massive price hikes likely if that happens.

crunchman

Fretwired said:

Blame Gordon Brown. He ruined the pensions of millions of hard working people with his excessive taxes. As for the RMT good luck if they can get away with it  - weak negotiators from TfL. The government won't bail them out so fares will have to rise. And if you commute be wary as the mayor wants TfL wants to take over train routes into London next - massive price hikes likely if that happens.

The new mayor has committed to freeze fares for four years with 2 more years to run on a multi-year pay deal that pays at least the RPI rate - at the same time as the government has made significant cuts in the grant to TFL, and the politicians have decided to bring in Night Tube which adds significant extra costs, and very little extra money as everyone just uses the same oyster cards but travels at a different time.  The sums do not add up at all.

He will either have to go back on his commitment, or there will be massive cuts that compromise services.  He might get away with it in the short term as cutting investment on infrastructure will cause problems years down the line for his successor.  Cutting investment to the bone and storing up problems down the line is normally a Tory thing but this time it's Labour.

Chalky

crunchman said:

Chalky said:

A maintenance worker joins TFL at 30, retires at 55 on FSP.  25 years working and his life expectancy is another 25 years.  So that pension scheme is like contributing more than half his pay packet to his pension from the day he started.  There is no way that is affordable long term, except by commuters paying for it.

As @Sporky said this is completely wrong.  If you retire at 55 you will lose a chunk of it.

Also, you don't get half your pay after 25 years.  It's a 1/60 scheme not 1/50.

Anyone who joined after 2006 can't retire at 55 at all.  The earliest you can take it is 60.

The scheme is currently extremely generous and I'm sure that there will be further changes at some point - most likely a move to average salary instead of final salary.

Ok, he works 30 years (30-60) and then gets 30/60ths constant, inflation proofed pension. Did he finish work at 60 on the same salary as he started? Unlikely. So the left hand side of the graph is a sloping line 30 years long from his starting salary up to his final salary at 60. The right hand side is a horizontal line 20 years long of his pension starting at 30/60ths of his final salary. The area under each side is the amount of money.

If his salary at the end of 30 years service is double what he started on, then his 20 years of pension will be 46% of his 30 years total salary income.

crunchman

Like I said, I'm pretty certain that they will try to switch it to average salary rather than final salary at some point.  That one will be a bit easier to swallow for the RMT as the people who will lose the most are those who get promoted into senior management.

Sporky

No, if he retires at 60 he loses a big chunk.

Again, you can look this up online. There is no need to just make things up.

crunchman

The big issue with all pensions is how much longer people are living.  When this was first brought in it wasn't nearly as much of an issue - especially with all the asbestos brake dust in the tube tunnels and the smoky air in all the canteens and mess rooms..

Tunnel dust is still bad now, but at least it doesn't contain asbestos.

capo4th

The cost of these pensions are unsustainable and unaffordable in an industry which is providing a very poor service to customers whilst charging them a fortune for the pleasure.

Chalky

Sporky said:

No, if he retires at 60 he loses a big chunk.

Again, you can look this up online. There is no need to just make things up.

Really? The website says he gets a reduction before 60 but a bonus after 60.

Again, you can look this up online. There is no need to just make things up.....

Sporky

Chalky said:

Really? The website says he gets a reduction before 60 but a bonus after 60.

Again, you can look this up online. There is no need to just make things up.....

Well, at least you finally looked it up and stopped making things up.

crunchman

You don't lose anything if you retire at 60 but you might not be able to reach the maximum.  You need to put in 40 years service to get the maximum pension.  Not many people are going to be able to do that by 60.  If you keep working and contributing after that then you can keep on building it up.

It is generous, and I am sure that TFL management will try to change it at some stage.  Given modern life expectancy you would expect them to change it to 65 rather than 60, and I think they will look at average salary rather than final salary.

There will be a battle with the RMT and the other unions over it.  Whether a Labour mayor has the stomach for that I don't know.

The other thing to bear in mind is that, historically, the pay wasn't great.  It was a bit like the Civil Service where they got less than people working in the private sector but they got job security and a nice pension.  Over the last few years though the pay has actually become very good so that no longer applies.  Because they couldn't afford the risk of strikes during the 2012 Olympics there was a very generous 4 year pay deal a couple of years before the Olympics in 2012.  Salaries kept on increasing at a time when people in the private sector were getting nothing, and when the government was freezing pay for other public sector workers after the credit crunch.  It was also around that time that the government was messing around with other public sector pensions, but they couldn't risk that causing industrial action during the Olympics either.

Chalky

crunchman said:

You don't lose anything if you retire at 60 but you might not be able to reach the maximum.  You need to put in 40 years service to get the maximum pension.  Not many people are going to be able to do that by 60.  If you keep working and contributing after that then you can keep on building it up.

It is generous, and I am sure that TFL management will try to change it at some stage.  Given modern life expectancy you would expect them to change it to 65 rather than 60, and I think they will look at average salary rather than final salary.

There will be a battle with the RMT and the other unions over it.  Whether a Labour mayor has the stomach for that I don't know.

The other thing to bear in mind is that, historically, the pay wasn't great.  It was a bit like the Civil Service where they got less than people working in the private sector but they got job security and a nice pension.  Over the last few years though the pay has actually become very good so that no longer applies.  Because they couldn't afford the risk of strikes during the 2012 Olympics there was a very generous 4 year pay deal a couple of years before the Olympics in 2012.  Salaries kept on increasing at a time when people in the private sector were getting nothing, and when the government was freezing pay for other public sector workers after the credit crunch.  It was also around that time that the government was messing around with other public sector pensions, but they couldn't risk that causing industrial action during the Olympics either.

My example was based on 30/60 not the maximum.  It still very generous by any measure. An old pal of mine left a well-paid IT job to become a driver on the Underground so the pay was good even back in those days!

capo4th

The RMT can kiss my ass all those railway trade union types holding the public to ransom fuckin arse holes !