Re-reading the final section of my previous post, I imagine a reasonable person could make an obvious riposte to my comments on public sector pensions. This person would work in the private sector, he doesn’t have an occupational pension scheme, and the personal private pension he is paying into each month is building a pension pot that, at current rates, will pay him an annuity on retirement which will just about cover the daily costs of a cup-a-soup and a small bottle of supermarket own-brand cola. He has little time for my whining, and with fair cause. After all…
“Why should my taxes rise to help pay for your gilt-edged pension, when I can’t afford to pay for a decent pension for myself?”
It’s a good point, I say, and I don’t think your taxes should rise for that reason. If there is a shortfall in public sector pensions then that should be met by the employees, or by employers within existing budgets, but it would certainly be unfair for you or others to pay more to ensure I have a good pension. As it is, whether or not public sector pensions are unaffordable is, I think, more arguable than the media often allows. That is when they aren’t just complaining that public sector pensions should be cut for the sake of it, because they are usually better than most private sector pensions.
“Ah, right,” he says, seeing me on the back foot, “but they are usually better than private sector pensions aren’t they, and that isn’t fair, is it? Why should I pay into your pension at all, when you don’t pay into mine?”
Well, it’s true that my pension may well be better than yours and you may not consider that fair. On the other hand, your pay may well be better than mine; is that also unfair? Perhaps you get a company car; why can’t I have one? We both have our pay and benefits and a good pension is one of my benefits; it doesn’t seem reasonable to me to cherry pick one area where my benefits may be better than yours and decide to reduce it for reasons of fairness, while leaving untouched other areas where your benefits may be superior to mine.
“But I don’t care if your pay or benefits are better than mine. I care that I’m paying for them. And not just me; millions of people in the private sector are paying a premium in taxes so that those in the public sector can have better pensions than we can ourselves afford.”
And millions of public sector workers pay for goods and services in the private sector, and so we pay into your wages and benefits, including into your pensions, or into the wages that you then invest in pension funds. Have a word with your employer if they choose not to provide as good a pension as my employer does. But if you must reduce things to this simplistic public sector versus private sector argument, as if both are just opposing homogeneous blocks, then whilst it’s true that you pay my wages, it’s truer to say that we all pay each other’s wages. And while your taxes do help pay for my pension, your consumption spending is also going to help pay for the occupational pension schemes of private sector workers whose pensions may similarly be better than the one you are able to afford. What’s the difference?
“Oh come on! The difference is that they are private companies and can do what they like with their revenue. That’s completely different to what government agencies do with public money. Our money.”
But it’s your money that private companies receive, just by a different method, through your discretionary spending rather than through taxation; it’s different, yes, but not, I think, completely different. Put it another way; you complain that public sector pensions are better than yours, and you are paying a premium on your taxes in order to pay for them. But many private sector occupational pensions schemes are also better than yours, because the employer pays into the pension scheme. In effect aren’t you therefore paying a premium when you buy their goods, paying a premium for their workers to have a better pension than you can have? And that premium is your money too, your money that you have had to pay on top of the price of the goods to pay for someone else’s pension. Should private sector companies also cut their occupational pension schemes in some great levelling down, simply because the benefits of such schemes are better than your own?
“No. But. That really is different. I can’t choose whether or not to pay taxes; I have to. I don’t just decide to pay my council tax, I am forced to by law, and some of that money gets paid into pensions whether I like it or not. With private sector companies I can choose who I give my money too, and so I’m not forced to pay into someone else’s pension if I don’t want to. I can always take my custom elsewhere.”
But would you?
“Would I what?”
Would you take your custom elsewhere in order to avoid paying into a private company’s staff pension scheme? It seems to me that we have reached a point where your main objection to public sector pensions being more generous than your own is because you have to pay for their services and so pay into their pensions schemes regardless; but you don’t seem to mind some private sector schemes being more generous than your own because you can simply avoid paying into such schemes by avoiding using their goods and services. So the question is, would you? Would you avoid using a private sector company solely because it means paying into a decent pension scheme? Would you ever consider not shopping at Tesco if you were to discover that some of their turnover goes into paying for a staff pension scheme that is better than your own? Would your hunt for an alternative supermarket be in any way influenced by whether or not another supermarket pays into an occupational pension scheme for their staff? Would you really object if they did? If not, and so the provision or otherwise of a staff pension scheme by a private employer plays no part in how you choose to spend your money, then surely the fact that you are able to take your custom elsewhere is not relevant to this discussion, and so should have no bearing on the provision or otherwise of a staff pensions scheme by a public sector employer to whom you have to pay your taxes. And indeed you could extrapolate this concept further; whenever you hear of something that occurs in the public sector that you think is outrageous and yet you have to pay for, consider what you would think if you heard of the same thing happening at a private sector firm you patronise, and whether you would still object to the extent that you would exercise your freedom to choose not to pay for it by taking your custom elsewhere. And if you wouldn’t, and if you would still cheerily pay for a private firm to do the self same thing that you find so objectionable in the public sector, consider that perhaps you’re not really viewing these things equally.
I realise, then, that somewhere during my last paragraph, my conversation partner had disappeared. Perhaps I had flummoxed him with logic and reason? Perhaps he had tired of feeding me prepared lines to which I could deliver my prepared responses. Perhaps my mention of Tesco reminded him that he needs to pop out for some milk. Perhaps he’ll return in a few minutes with a crew to make me shut the fuck up. But perhaps, just perhaps…he didn’t exist at all, and was just a compliant FIGMENT OF MY IMAGINATION!
That would mean that I’ve been talking to myself, all this time. “What’s new, on this blog,” you may very well think; that is if, indeed, you exist. But this feels different. I’m tired, so very, very tired. Time to splash myself with cold water and go out for some fresh air.