Pensions

[Paul Belford]

OK then, Unitof1, off you go...

[Dirty Dave Lincoln]

E eck Paul you give Unit his own topic for pensions and get a silence more profound than when Jonah was swallowed by the whale!

[Paul Belford]

Funny that...

...though perhaps he is working away from his desk (hopefully at an appropriate charge-out rate to ensure he can develop a pension plan) and will reply later on?

[Dirty Dave Lincoln]

or-
1, hes off collecting his pension.
2, you took the fun out of the subject for him!

[drpeterwardle]

I think Unit of 1 has a valid point about government pensions and hoi they are paid for and I think David is being naive when he says that you just charge more to cover the cost of whatever. I share Uof1 anger.

Looking at the accounts Uo1 posted there are some serious funding issues for the pension funds. (The FTSE only fell 0.5 of a point today). Archaeological organisations are no different to others.

There is a basic statement pension for everybody provided that you have paid the stamps (NI contibutions).

Then there are employers schemes where the employer makes a contribution.

There is also the final salary schemes that pays a portion of the final salary index linked such as those recieved by the government or local government employees.

In all case there is a fund which pays the pensions from the returns of investments such as development or the stock market. There is a huge short fall in the amounts for the government households and I read somewhere that this was going to cost every household something like 40k in extra taxes.

OK lets consider the real monetary value of a LPA pension paying 50% of a final salary and how much it would cost me to buy a similar product.

See http://www.nsandi.com/products/ilsc/index.jsp which give a return of 1.5% net of tax say 1.75% without tax deducted. For me to buy the level of pension for a 50% of a project officer salary would reuire a pension fund of HALF A MILLION POUNDS yes 500k.

To get a pension of 18k per year of the same value ir index linked would take somebody over the maximum threshold.

Most people pay into a pension fund and then have to buy an annuity which at present are giving a return of 2-3%. This would require a pension fund of 800k. Then there is the problem of inflation to be taken into account which is low at the moment but has been known to be 15%.

So a to get the 20k a year pension would mean a contribution of 4k per year for 35 years (growth at 9% & ignoring inflation) for annuity and 5k for index linking.

Translate that into a charge out and that will be the difference between being competative and not being competative.

If you are self employed pensions are a major downside because you have to save such huge amounts of money to face a decent retirement or keep on working.

In my case many years of working without even my NI being paid for or being in a pension fund makes matters worse.

Peter Wardle
(Showing his age by being worried about pensions.

[lucy78green]

my problem is every time I think about getting a private pension - I get bogged down in finance speak and run away screaming - I don't understand finance - I didn't do it in A-level maths - and I haven't paid all my stamps either.

Lucy

[Paul Belford]

Unit of 1 might have a valid point. However my objection was to his hijacking other threads to make that point.

I agree that the pension situation is lop-sided. Our colleagues in Local Authorities and National Government Agencies (EH, Natural England etc.) have very generous pension provision. On the other side of the coin, salaries in local authorities are extremely low.

As with Peter I have an incomplete NI record (due to the transitory and cash-in-hand nature of many early archaeological jobs) and no pension provision through employer or private scheme. As I approach 40 I do worry about these things. My advice to anyone is to get saving before you are 25 to build up the kind of fund Peter is talking about.

However my personal view is that private pension schemes do not offer good value for money. My own preference is to invest what I can afford using tax-efficient savings vehicles. Clearly this is insufficient but what can we do? I don't expect anyone is suddenly going to leap out of the woodwork and say 'there there, poor archaeologists, never mind we will make sure you are OK in retirement, have #163;800,000 to invest!'.

We do need to make sure that the new generation of archaeologists (those now in their 20s) does not suffer the same way that we did.

[charlie farnsbarnes]

I previously posted this on another thread, but it seems more appropriate to re-post it here. I realise that this is a bit of a trite statement, but surely everyone is in some sense a pension grabber, in that we all pay NI contributions in the expectation of receiving a pension at the end of it. Also, I fail to understand why someone paying in to an occupational pension should be vilified for having decent working conditions. Surely archaeology should aspire towards making this situation the norm rather than the exception? Why should archaeology as a profession seek to drive pay and conditions down to the lowest common level, rather than strive towards standards that are the norm in most other professions?

[Paul Belford]

quote:Surely archaeology should aspire towards making this situation the norm rather than the exception? Why should archaeology as a profession seek to drive pay and conditions down to the lowest common level, rather than strive towards standards that are the norm in most other professions?

Hear hear!

Going back to Peter's point about competitiveness and charge-rates, I would suggest he reads Michael Heaton's thought-provoking piece in The Archaeologist. He gave an updated version of his paper at the IFA last week, which can be downloaded from this page.

[Unitof1]

Lucy do you work or have you worked for any trusts, charities or council units?

Thanks peter

So the way I see it is ethical to set up a unit based on archaeology in a charity for education where I make myself the director and hopefully it is a RAO where I get, and the unit contributes to, a final salary council tax payer guaranteed superannuation pension for me and possibly a few others. After that for the middle management I would probably have some stakeholders pension into which we might put a few %, not sure that we would do any % for the diggers and of course we would be using volunteers and doing outreach although I expect a large source of the revenue to come from purely commercial ppg16 derived projects. Being in the charity business we would be exempt of corporation tax although we might pay vat if we include a limited company set up as well to limit the liability. Because of our articles set up we would also be eligible for grant funding particularly for the community and education, volunteers, giving experience and get involved with partnerships. Developers might like it cause they know that we are really part of the establishment and would probably have a close relationship with the authorities as we would be getting the same pension rights. We could blurr it a little by doing something district based but we would still be seen within a county council framework.

What would have been best is if this had all been set up between 15 and 25 years ago when the pension problem was first spotted so that by now it would have settled into a way of life.

Just need a middle management who would fall for working for my pension and the rest should follow. The fact that we can claim that we are a charity and that there is a tradition of helping and working with volunteers means that we could probably find a source of people who are willing to martyr themselves in the cause (making arrangements for their own post-retirement needs and better still telling others to stop their winning and waiting for someone to wipe their bottoms)). Diggers will have no chance. What you do reckon.

++++ CUT by BAJR ++++++++

unacceptable posting about a named company, denigration of charities and outreach.