Nov 2011 09

Last week it was revealed that Ron Dobson, Commissioner of the London Fire Brigade, retired to get his £133,000 annual pension allowance only to jump straight back into his old job. The Daily Mirror claims that he may have even received a £700,000 pay-off if, as entitled, he converted a quarter of his pension to a lump sum.

At a time when taxpayers are tightening their belts and public sector organisations look for necessary savings, it is obscene for the Fire Brigade’s Commissioner to quietly make a few tiny contractual adjustments to feather his own nest. I can only imagine that many of Mr Dobson’s colleagues will be livid at his smash and grab raid.

Paul Embery, a regional official for the Fire Brigades Union, also attacked the pay-out, calling it “deeply unethical”.

A spokesman for the London Fire Brigade claimed the move is actually a “cost saving” measure. However, it has been reported that his new salary, combined with his pension, actually totals a similar amount to what he was on before this charade started.

Unfortunately this isn’t the first case of questionable pension activity and so-called “double dipping” in Britain’s fire brigades. In August, Andrew Allison wrote about Humberside Fire and Rescue Service, where one officer received a promotion and after only eight weeks into the job he saw his pension lump sum increase to £29,000 – for just two months’ work!

Earlier this year, Strathclyde Fire Service chief Brian Sweeney pulled a similar trick to gain a £500,000 pay-off before returning to work. He said at the time: “people need to understand it’s not taxpayers’ money – it’s my private pension.” It is the arrogance of the likes of Sweeney and Dobson which needs to be challenged – taxpayers are paying for these lavish pensions. Around a third of all private-sector workers have an employer-sponsored scheme – most do not. And it is those people that are being asked to carry on paying for increasingly expensive public sector pensions. Until we see genuine reform, the least public sector executives can do is not to take advantage of the system.

Darren has a BA in Politics from the University of Surrey. He joined the TPA as an intern before being promoted to Policy Analyst. Darren’s research focuses on council spending across English regions.

  • Roywilson

    Its time to put a cap on ALL pensions payed for by the TAX payer.  The tax payer should be in control of OUR Tax and not allow these people to pay themselves gold plated Pensions at the expense of others.£28,000 should be a Maximum for a Pension anything above that is GREEDY.

    • Foolsgold Gordo

      Don’t tell the High Court Judges, thei pensions are over £1 million/year.  So I don’t know what teir salary is!  That only came to light when they threatened action when a super tax on pensions over £1 million was muted!

      • Etoliver

        I did not realise we paid some people such an obscene pension. It makes a mockery of the basic state pension and all those struggling to make ends meet on the basic wage.

      • Ian Harris

        Foolsgold Gordo has got the wrong end of the stick. Judge’s pension pots may well be over a million, which today will give them a pension of around £50,000 a year, depending on age, marriage status, inflation linked etc

  • Ian Harris

    This also happens with local council staff, who retire, start drawing their pension, and then are re-engaged at a similar salary as before, probably accruing more pension entitlements.  But surely with public service pensions, there is no ‘lump sum’ from which they can take 25% tax free?  Public service pensions are not funded-pensions are paid out of current income which of course comes from the tax-payer. The quoted value of the fund is not real money-it is just a projection of the amount that would be needed to fund their pension as if it were a private pension, and with the low returns prevailing today, the notional sums are huge.
    Their salary deductions just go into a common taxation pot like PAYE. Or am I wrong?

    • Blarg1987

      Sorry Ian but you are slightly right, some pensions are not funded but some public sector pensions are funded which tax payers and employees contributions goes into a fund which is invested in assetts, buisnesses, property and shares which returns is used to pay out for exisitng and future members.
      There aresome shcemes in which the tax payer has to pay out in full for in which you are right in saying that there are schemes that tax payers money is used only but I think this is in the minority of schemes.

  • Foolsgold Gordo

    Yep, I worked with a chap that was already drawing two pensions and then got another plus they paid him £20k to stay on another six months to off set his tax losses because he was near his genuine retirement age.  Other people left on early retirement and then returned as consultants.  They were so keen to leave and then they were back again, all costing the tax payer.  On the other hand, some people get nothing, as they quote all the rules that regulate retirement but I’ve seen that these rules can all be manipulated to get the required result, i.e. cash in certain people’s pockets.  Yes, the money being wasted is fantastic!

    • Blarg1987

      This has also happened in the private sector as well with lots of companies who made lay offs in the late 80′s early 90′s getting ride of staff one week then rehiring them the next, mainly due to short sightedness of senior management, could this be the same case today?

  • Northernguy

    How can commuting part of your pension into a lump sum be described as a “payoff”? If this is the case, millions of people each year are getting “payoffs”.

  • Northernguy

    Ian Harris – the Local Government Pension Scheme is indeed a “funded” scheme – unlike, for example, the Teachers Pensions Scheme.

  • jolyonwagg1

    The public sector Gravy Train rolls on and most of the time the UK public are completely kept in the dark over these feathering of the nest practises, this kind of retire, get fat pension then go back to work is widely practised within local councils up and down the country? and the biggest shame is no one bats an eyelid?