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Is our real problem Ealing's pension deficit?

Watching the rugby at the weekend I got into conversation with another group of people who were in the same bar and it turned into a very convivial afternoon. Given the result we wanted to talk about something more cheery so natuarally the subject switched to pensions rather than the match.The chap I was talking to seemed to know his stuff and told me that Ealing Council in particular had a major problem with their fund which was running a very substantial deficit. He said most local authorities had an issue because fewer people were joining council schemes because of outsourcing and head count reduction and more and more people were retiring and living longer but Ealing's short fall was more than most. He also said that at some point soon, just like many companies the borough will have to start covering the deficit which could be in the region of half a billion. There is no prospect that scheme income will make it self funding because, although head count has reduced, average salaries have increased significantly and generous early retirement packages remain in place. He said that Ealing like many other councils have reduced costs by persuading people to take retirement. This is actually more expensive but pushes when it needs to be paid for out into the future. His estimate was that by the end of this decade local taxes would need to double to make sure the pension fund was adequately funded.I really don't know enough about pensions and the way they work to know if this is alarmist nonesense or a timely warning. I have heard people say similar things before. It there anyone with expertise in these matters who could comment?

Andy Jones ● 2414d6 Comments ● 2398d

The Slow Death of the BBC

I was vaguely aware of how these might be difficult times for the BBC but until I read some coverage of recent event and spoke to people with some direct knowledge this weekend, I had little conception of how bad things where. The four hundred or so people who were sacked recently were told in no uncertain terms that they lost their jobs because the corporation needed to make savings after all the pay increases that became necessary after the Samira Ahmed judgement. They are so terrified of legal action about unfair pay (even from men) that they have erred on the side of caution. As they can no longer use the excuse of celebrity or public profile for paying someone more then they have to pay 'star' wages to people who are clearly not stars.  If this was the extent of their problems then they could weather the storm but this government (particular Dominic Cummings) really wants the corporation dismantled. The decriminalisation of non payment of the licence fee might seem a rational and fair move but it will have a massive impact on the BBC's finances as well having to fund over-75s licence fees. Restrictions on licence fee increases means that the ongoing squeeze on the BBC will continue and accelerate. Like most organisations forced to cut costs they seem incapable of trimming in the middle management executive positions where most of the fat is and content creation is where most of the jobs are going. They also have quite intractable unions to deal with and a pension fund deficit of £1.9bn and rising. Increasingly what's left of the BBC licence fee will go to fund this deficit and the pay of an unsackable but unproductive layer of middle management and fewer and fewer programmes will be made.

Gordon Southwell ● 2409d26 Comments ● 2399d