Robin Hood in Reverse
Head teachers in England, Wales and Northern Ireland have apparently voted for a ballot on industrial action - over planned changes to their pension scheme.
The NAHT - the 'headies union' - has described plans to replace the present final salary scheme with a career average pension - as a 'betrayal'.
Which just goes to show that head teachers - or at least those attending the union's annual conference - are living on a completely different planet from the rest of us.
How so?
Because as I've said numerous times on the blog site - under a final salary pensions scheme the lower paid are subsidising the higher paid and - in fact - head teachers are a particularly good example.
A head teacher might assume the top job for - let's say - the last 10 years of their teaching career which might last 40 years in total.
So a final salary of - let's say - £70,000 a year is the figure used to calculate the value of their future pension - which would work out at £35,000 a year for the rest of their life.
For for the bulk of their entire teaching career the head teacher may have been earning - let's say - £30,000 a year.
Which means that the head teacher ends up with a pension worth much more than they have put into the scheme over 40 years - and that's not even taking into account the tax free lump sum.
A career average scheme would pay a pension based on head teacher's average salary over the whole 40 years - which in this example would out at £20,000 a year instead of £35,000.
The difference between the two schemes is being subsidised by other much lower paid workers - like the low paid, part-time school cleaner - or the low paid, part-time worker in the schools meals service.
So if anyone should feel betrayed - it's the lower paid council workers who have been subsidising the much more generous pensions of head teachers - for all these years.
The NAHT - the 'headies union' - has described plans to replace the present final salary scheme with a career average pension - as a 'betrayal'.
Which just goes to show that head teachers - or at least those attending the union's annual conference - are living on a completely different planet from the rest of us.
How so?
Because as I've said numerous times on the blog site - under a final salary pensions scheme the lower paid are subsidising the higher paid and - in fact - head teachers are a particularly good example.
A head teacher might assume the top job for - let's say - the last 10 years of their teaching career which might last 40 years in total.
So a final salary of - let's say - £70,000 a year is the figure used to calculate the value of their future pension - which would work out at £35,000 a year for the rest of their life.
For for the bulk of their entire teaching career the head teacher may have been earning - let's say - £30,000 a year.
Which means that the head teacher ends up with a pension worth much more than they have put into the scheme over 40 years - and that's not even taking into account the tax free lump sum.
A career average scheme would pay a pension based on head teacher's average salary over the whole 40 years - which in this example would out at £20,000 a year instead of £35,000.
The difference between the two schemes is being subsidised by other much lower paid workers - like the low paid, part-time school cleaner - or the low paid, part-time worker in the schools meals service.
So if anyone should feel betrayed - it's the lower paid council workers who have been subsidising the much more generous pensions of head teachers - for all these years.
