Whilst private sector pension schemes have been closing down rapidly in the last few years, public sector employees continue to enjoy “gold plated” benefits. In addition, rates of ill health retirement in public sector pension schemes are extremely high. Proposed reforms to public sector schemes will make little difference to the benefits available to new employees and no difference at all to benefits of existing employees.
Private sector taxpayers have to meet the cost of public sector pensions, so how has this divide between the standard of private and public sector pensions arisen? Part of the answer lies in the fact that the costs of public sector schemes are not properly accounted for.
In this monograph, Neil Record estimates that public sector pension liabilities are about £1trillion – but the government publishes estimates of the