credit crunch and pensions ?

[petesdragon]

Sorry if this has been asked before, or is a bit out of the normal line of questions, but having seen on the news about the trouble in the american banking sector and our own( potential) troubles in this country with Northern Rock, I was wondering if anyone has any financial thoughts if these problems could affect the military pension that we all seem to be staying in for ( 3 years to go and on the old scheme), cheers

 

[NotAnIDOYet]

Sorry if this has been asked before, or is a bit out of the normal line of questions, but having seen on the news about the trouble in the american banking sector and our own( potential) troubles in this country with Northern Rock, I was wondering if anyone has any financial thoughts if these problems could affect the military pension that we all seem to be staying in for ( 3 years to go and on the old scheme), cheers

I think our pensions are Treasury backed rather than investment but I am sure an expert will be along shortly. I am in a similar situation so am watching with interest here!

 

[Cooheed]

I would suggest that your Treasury backed pension is set in stone.............. Unless the country goes bust... Maybe £100 Billion to NR wasn't such a good idea after all.

 

[Bitburger]

Pensions are paid out of the Defence budget.

 

[firestorm]

Military and public sector pensions are not run the same way as private pensions.
As was said in the previous post our pensions aren't invested as such, they come out of the budget at the beginning of the financial year.

 

[petesdragon]

I understand that pensions are paid from the defence budget, but as the goverment somehow finds Billions to support Banks etc, this money will have to be taken from somewhere, so where are they getting it from and can they change the pension scheme for those of use already signed up, if not then people joining up now might be in for a shock further down the line, and if the pension goes tits, then how many would stay in for the full engagement ? and of course this would have a knock on effect on retention of knowledge and expierience.

 

[firestorm]

I understand that pensions are paid from the defence budget, but as the goverment somehow finds Billions to support Banks etc, this money will have to be taken from somewhere, so where are they getting it from and can they change the pension scheme for those of use already signed up, if not then people joining up now might be in for a shock further down the line, and if the pension goes tits, then how many would stay in for the full engagement ? and of course this would have a knock on effect on retention of knowledge and expierience.

Money comes either from reserves or is borrowed. We'd have to be up sh1t creek with out a boat before pensions are looked at. However. Pensions have already been looked at and can be changed at anytime, I'd say they were moderatly safe for the fact that they have recently been reviewed.
I doubt if a pension would ever go tits up though.

 

[DE Scumbag]

Our pensions come from the defence budget and it would be illegal for the government to dip into them to pay off anyone else. However the Govt can change legislation, can't it. (But that would be a hell of a vote loser! )

 

[firestorm]

Our pensions come from the defence budget and it would be illegal for the government to dip into them to pay off anyone else. However the Govt can change legislation, can't it. (But that would be a hell of a vote loser! )

They've done it before. They wouldn't do it in one go though, just chip away, as they have been.

 

[Pistonbroke]

Many moons ago I asked almost the same question to the liason team. Their answer was that it would take an act of parliament to change the way it is run. However, since when has that stopped them from bending the rules!