I am paying more for somebodys public sector pension than my own Private pension

jimmmy

molloyjh wrote: »

I'm not disputing the total wage bill issue, just the notion that this means everyone in the Public Sector is overpaid.

Nobody can jump to the conclusion and say that everyone in the public service is overpaid ...there could be people at the very bottom on the minimum wage or close to it. That is not the point. The statistical average public sector wage in Ireland - as confirmed by our own C.S.O. - is just so out of line it is amazing it does not embarass even the most hardline public servant on this board.

solice

According to Bernard Harbor, National Secretary to the Impact Trade Union, in a letter to the editor in todays Irish Independent.

255,000 out of the 310,000 public servants earn less than €60,000 a year.
Some 55,000 of these earn less than €30,000 and 74,000 people are paid between €30,000 and €40,000

This would imply:
55,000 (18% of the PS) less than €30k
74,000 (24% of the PS) between €30k and €40k
126,000 (40% of the PS) between €40k and €60k
55,000 (18% of the PS) more than €60k

I dont know if these figures are accurate, but I imagine Bernard Harbor can stand over them if he is stating it in a letter to the indo.

jimmmy

solice wrote: »

I dont know if these figures are accurate .

I doubt if they are exact....last October the numbers employed in the Irish public sector stood at 316,339, ( up from 222,069 in 1998 ) .... yet Bernard Harbor, National Secretary to the Impact Trade Union, is putting the number now at 310,000. Maybe he is excluding the best paid ones ? http://www.timesonline.co.uk/tol/news/world/ireland/article4969079.ece

Count Dooku

grahamo wrote: »

What jobs are they including in that? TD's? Consultants? Judges etc. Full-time workers? Part-time workers?
35k the average industrial wage in Ireland? I know labourers that earn more than that!

Don’t forget that CEO’s included in this statistic as well and they are earning more then TD’s and a lot of people a getting more then average, but still average is average. Somebody is getting more. Somebody is getting less. But total payroll bill says a lot.
Main reason while average in private sector is so low is that private sector is suffering from invasion of cheap labour from East, while public services enjoying their protection from PS unions. EE workers is about 15% of private sector and most of them are working for minimum wage, while PS workers enjoing their nice remuneration packages and didn’t worry about competition from EE workers.

Count Dooku

solice wrote: »

According to Bernard Harbor, National Secretary to the Impact Trade Union, in a letter to the editor in todays Irish Independent.



This would imply:
55,000 (18% of the PS) less than €30k
74,000 (24% of the PS) between €30k and €40k
126,000 (40% of the PS) between €40k and €60k
55,000 (18% of the PS) more than €60k

I dont know if these figures are accurate, but I imagine Bernard Harbor can stand over them if he is stating it in a letter to the indo.

It means that majority of PS workers are earning more then 40K
Next question – do they deserve it

Count Dooku

molloyjh wrote: »

Either way my point still stands. I'm not disputing the total wage bill issue, just the notion that this means everyone in the Public Sector is overpaid.

It fine with me
Lets assume that everybody, who is earning more then average salary in private sector is overpaid

Gumbo

Count Dooku wrote: »

It fine with me
Lets assume that everybody, who is earning more then average salary in private sector is overpaid

what about the people in the private sector earning more than the average salary......are they overpaid?

solice

Count Dooku wrote: »

It means that majority of PS workers are earning more then 40K
Next question – do they deserve it

Making a fair assumption, if 126k people earn between €40k and €50k, then 63k people earn between €40k and €50k. Therefore 192k (55k+74k+63k) or 62% of the PS earn less than €50k, which is the magic €966 per week figure.

So even though the average is indeed the average and a good way of analysing data, a majority of people earn less than the average. Which implies that the average is indeed skewed by the high earners.

Like I say, I cant stand over those figures and I have a deep mistrust of unions but that is the only breakdown that I have seen so far so I thought I would put it up to add to the debate. I imagine both sides will be able to cherry pick statistics from it.

molloyjh

Count Dooku wrote: »

It fine with me
Lets assume that everybody, who is earning more then average salary in private sector is overpaid

Ah now you're getting into silly territory. What does "overpaid" mean? And why would it ever be related to this kind of average figure? Using the average for anything other than the overall wage bill is oversimplifying in the extreme.

Count Dooku

kceire wrote: »

what about the people in the private sector earning more than the average salary......are they overpaid?

Of coarse, not
Imagine two scenarios
First case
Something happened, lets say FG introduced low taxes and as result average salary in private sector doubled, mostly in export industries, without any local prices increase. As results collection money from taxes increased, and public finances in good shape.
Second case
Labour joined FF in government and average salary for public services doubled. Without any support from private sector, public finances are screwed and country cannot borrow money anymore. Final stage is default and IMF at front door.
Conclusion – big salaries in private sector is good, big salaries in public sector is bad

Count Dooku

molloyjh wrote: »

Ah now you're getting into silly territory. What does "overpaid" mean? And why would it ever be related to this kind of average figure? Using the average for anything other than the overall wage bill is oversimplifying in the extreme.

Overpaid means that they are getting money, which they don’t deserve, due state monopoly on public services. If it would fair completion as in some parts of private sector, they wouldn’t earn so much.
What Irish PS workers doing different from their colleagues in other EU countries?

Count Dooku

solice wrote: »

So even though the average is indeed the average and a good way of analysing data, a majority of people earn less than the average. Which implies that the average is indeed skewed by the high earners.

CEO’s and top management in private sector are earning even more then TD’s and managers in public sector. But average salary in private sector is still lower
It means that too many PS workers are overpaid

solice

Count Dooku wrote: »

It means that too many PS workers are overpaid

Originally I said that I totally agree.

I dont, what I actually think, and excuse me for not stating facts or figures, but I think that most of the people are on fair and justified salaries. But there are many, like there are in every industry that cannot justify their salary.

P. Breathnach

molloyjh wrote: »

Ah now you're getting into silly territory...

Getting into silly territory? Most of the discussion here has long been in silly territory: trips to Oz; why the average isn't really the average; stuff like that.

It is possible that some of the higher-paid public servants are worth all they are paid, and that some of the lower-paid ones are giving bad value for their wages.

K-9

Count Dooku wrote: »

Don’t forget that CEO’s included in this statistic as well and they are earning more then TD’s and a lot of people a getting more then average, but still average is average. Somebody is getting more. Somebody is getting less. But total payroll bill says a lot.
Main reason while average in private sector is so low is that private sector is suffering from invasion of cheap labour from East, while public services enjoying their protection from PS unions. EE workers is about 15% of private sector and most of them are working for minimum wage, while PS workers enjoing their nice remuneration packages and didn’t worry about competition from EE workers.

Only about 5/6% of the workforce are on minimum wage based on an hourly wage rate from the CSO. Link might have been posted earlier on this thread. Something like 40% of workers do not pay tax (until this year) and the bulk of that would be part time workers. This would skew the Average Industrial Wage too, which is also a little outdated these days. Most Private Sector area are over 40k.

solice wrote: »

Making a fair assumption, if 126k people earn between €40k and €50k, then 63k people earn between €40k and €50k. Therefore 192k (55k+74k+63k) or 62% of the PS earn less than €50k, which is the magic €966 per week figure.

So even though the average is indeed the average and a good way of analysing data, a majority of people earn less than the average. Which implies that the average is indeed skewed by the high earners.

Like I say, I cant stand over those figures and I have a deep mistrust of unions but that is the only breakdown that I have seen so far so I thought I would put it up to add to the debate. I imagine both sides will be able to cherry pick statistics from it.

Yes, but it still leaves 58% earning over 40k.

Interestingly, 64% earn between 30 and 60k and most importantly, the exact same percentage (18) that earn less than 30k, earn more than 60k! Looking at it that way, this average seems pretty close to the mark.

solice

K-9 wrote: »

most importantly, the exact same percentage (18) that earn less than 30k, earn more than 60k! Looking at it that way, this average seems pretty close to the mark.

Ok, take out the top 18% and the bottom 18% (under 30k and over 60k)...this would mean that indeed 64% earn between 30k & 60k. Im confused as to how you get that to work out to being "pretty close to the mark"? Are you saying that the average so earns €45k or €865 per week?

I genuninely am confused and just curious as to what you mean by "pretty close to the mark"?

K-9

solice wrote: »

Ok, take out the top 18% and the bottom 18% (under 30k and over 60k)...this would mean that indeed 64% earn between 30k & 60k. Im confused as to how you get that to work out to being "pretty close to the mark"? Are you saying that the average so earns €45k or €865 per week?

I genuninely am confused and just curious as to what you mean by "pretty close to the mark"?

Exactly, it's statistics, so we can read what we want into it.

55,000 (18% of the PS) less than €30k
74,000 (24% of the PS) between €30k and €40k
126,000 (40% of the PS) between €40k and €60k
55,000 (18% of the PS) more than €60k


40% earn between 40 and 60k.

The 42% under 40k would actually bring it back down and I'm assuming the vast majority of the 18% above 60k would be on no more than 100k.

solice

K-9 wrote: »

Exactly, it's statistics, so we can read what we want into it.

So unless someone provides a breakdown of the PS workforce by grade/level from A to Z, and the associated salaries then we are all just shooting fish in a barrel and arguing about something we dont know.

Never stopped me before

K-9

solice wrote: »

So unless someone provides a breakdown of the PS workforce by grade/level from A to Z, and the associated salaries then we are all just shooting fish in a barrel and arguing about something we dont know.

Never stopped me before

YEP, but it's a better breakdown that we had before!

You'd have to get the grades, levels, increments, allowances etc. etc.

If somebody is interested they can do that!

Count Dooku

solice wrote: »

So unless someone provides a breakdown of the PS workforce by grade/level from A to Z, and the associated salaries then we are all just shooting fish in a barrel and arguing about something we dont know.

Never stopped me before

You don’t need to do it, because it was done during benchmarking, when special body compared salaries in public sector and similar occupations in private sector. PS unions decided to use following industries to do benchmarking last time

Having regard to its terms of reference, the Body decided that the sample of private sector companies should be broadly reflective of the economy based on the criteria of company size (numbers of employees), geographical and sectoral spread. It also decided that a large sample size would be necessary to meet these criteria. The Body identified the main sectors of the economy in the private sector from CSO data,3 namely: manufacturing; distribution and services; financial services; and construction. In turn, these sectors were broken down into NACE subsectors. Within each of these sub-sectors, and again from the CSO data, the required number of firms in each sub-sector was specified by company size.

Now we need to repeat benchmarking with exactly the same industries, exactly the same companies and exactly the people with only one exception – because banks now semi-state bodies, they must excluded from new benchmarking.
It will be very important to adjust numbers in certain departments, such as Department of Finance, Financial Regulator and Department of environment, because property bubble is finished and they don’t need so much staff to handle planning permissions and support pyramids.
Salaries in private sector has been dropped significantly plus a lot of people has been made redundant recently and they must be included into statistic as well.
PS workers started to play this game about equal salaries first. Now it’s time play this game for private workers. Unfortunately unions are more worrying about PS workers. But if FG will not protect PAYE workers from greedy PS workers, PAYE workers must unite, overthrow corrupted government and replace public services with new, more efficient ones.

kindajaded

ixoy wrote: »

They should but contingent on the fact that this is recognised in their renumeration and adjusted accordingly (which apparently benchmarking factored in last time).

Speaking of averages vs medians (or is it mode?) wages, is the same not applicable when comparing with private sector wages too? Aren't private sector figures we see averages for the industry and also factoring in management, etc? And is the PS/CS so top-heavy that the APs+ (and equivalent) really distort the bottom line so much?

no ixoy - the 'average indutrial wage' of about 35k does not include management, professionlas etc. - it is defined to include the workers:

"The industrial sector included manufacturing industries; mining and quarrying; and the electricity, gas and water supply sector.
Industrial workers were defined as operatives, maintenance workers, storekeepers, packers, cleaners, basic supervisory staff and apprentices. Managerial, professional, technical and clerical staff were not included in the calculation of the average industrial wage."

this is the link to the oireachtas page where this definition comes from:


http://historical-debates.oireachtas.ie/D/0644/D.0644.200712180082.html

so, basically, when PS average wages are quoted they are measuring something quite different to the 'average industrial wage'. you are then comparing unskilled + semiskilled workers in the private sector to unskilled + semiskilled + technical + professional workers in the PS.

that is why trying to compare an average of 48k to an average of 35k is meaningless (unless you are a communist). the 'median' of PS wages might give you a more accurate picutre as it would present what 50% of PS workers make but even at that you would need to find median values for the private sector and account for the different age profiles, skill base etc..

solice

Count Dooku wrote: »

You don’t need to do it, because it was done during benchmarking, when special body compared salaries in public sector and similar occupations in private sector. PS unions decided to use following industries to do benchmarking last time


Now we need to repeat benchmarking with exactly the same industries, exactly the same companies and exactly the people with only one exception – because banks now semi-state bodies, they must excluded from new benchmarking.

Thats a really good point. The majority of the work is already done, all the governement needs to do is update. They would have to take account of the reduced pay (relative of course to pay when benchmarking was first carried out) that people are now on in respect of pay cuts in the private sector and the increase in taxes for those working in the public sector (pension levy) but it wouldnt be difficult.

My only fear is that the so called "Social Partners" would not accept a possible decrease in salaries as a result of deflation and lower wages in the private sector and would drag the country to a complete halt with strikes and work stoppages. Social Partnership aint a partnership if they dont accept the negative aspects as well, it cant all be one sided.

Count Dooku

kindajaded wrote: »

no ixoy - the 'average indutrial wage' of about 35k does not include management, professionlas etc. - it is defined to include the workers:

industrial average is only part of private sector average
As you can see from those documents average earnings per hour in industry was 15.66, in private sector in total was 17.11, while in public services it was 25.47

jimmmy

Ah but has the government the political will to bring public sector pay + pensions more in line with what it should be ?

solice

jimmmy wrote: »

Ah but has the government the political will to bring public sector pay + pensions more in line with what it should be ?

If benchmarking was carried out again tomorrow and the result was that the PS is paid more "on average" (begining to hate the word average) would the PS workers accept a proposal that would result in decreased pay? I for one would accept it. Social Partnership has to go both ways...

In terms of bringing pensions into line "with what it should be"...Jimmy that was covered in the first 23 odd pages of this thread. Due to the changes brought about by the government recently in terms of the levy and in the last few years with the 6.5% compulsory pension contribution, the PS pension will be more than capable of funding itself, including any legacy issues of all the people who joined the PS pre 1995. That debate is over.

Riskymove

The last benchmarling exercise decided to deduct 12% from all pay awards as they decided what pensions were worth in Public Sector.

So if you all think benchmarking is worthwhile and should be done again, that will have to be accepted as being a closed book for the pensions!

jimmmy

solice wrote: »

In terms of bringing pensions into line "with what it should be"...Jimmy that was covered in the first 23 odd pages of this thread.

Exactly. If you accept that public sector pay is out of line ( which in fairness you seem to ) they given the "gratuity" and 50% of finishing pay being the pension, then pensions should also be reduced, if for no other reason that no other country in the world can be found to have either such high public sector pay or pensions, and given the state of the country's finances. The public sector pensions never funded themselves and do not currently fund themselves. Pensions must be adjusted accordingly. For example, a Garda taking early retirement in say 3 weeks or 3 years time will never have paid in to his pension pot what its worth at retirement.

solice

jimmmy wrote: »

Exactly. If you accept that public sector pay is out of line ( which in fairness you seem to ) they given the "gratuity" and 50% of finishing pay being the pension, then pensions should also be reduced, if for no other reason that no other country in the world can be found to have either such high public sector pay or pensions, and given the state of the country's finances. The public sector pensions never funded themselves and do not currently fund themselves. Pensions must be adjusted accordingly. For example, a Garda taking early retirement in say 3 weeks or 3 years time will never have paid in to his pension pot what its worth at retirement.

Absolutely! If the pay is reduced then the pension entitlement is reduced as well. I dont think anyone could ever claim that a guard retiring in 3 weeks or in 3 years will have paid enough for his own pension. But now that PS workers are paying 11.5% (at a minimum) to 16%+ in pension conributions, the PS pension will in time be able to fund itself.

Also it was shown that in this thread that only those earning 60k+ wont pay enough into their pension fund to cover the cost of the pension, based on todays pension contributions. But it was also shown that only 18% of the PS earn more than 60k. So that means roughly 82% of PS workers pay too much, the amount they pay too much will be used to offset against those that dont pay enough.

So you are right Jimmy, pensions will come down if pay is reduced. But still, the PS pension fund will be more than capable of looking after itself and will probably even produce a surplus for Governement to use in other areas such as capital expenditure etc. But it will be a number of years before that kicks in. At least the Govt did something right recently and it took corrective measures to sort out the PS pension pit hole.

Riskymove

solice wrote: »

But now that PS workers are paying 11.5% (at a minimum) to 16%+ in pension conributions, the PS pension will in time be able to fund itself.

if only that were true!!

The pension levy is not being ringfenced into public sector pensions, it is simply going into general exchequer

K-9

Guards only make up 14/15,000 of the PS. Why the focus on them?