Audt Commission propose cutting Local Government pensions deficit
The Audit Commission has produced a report on the unaffordable Local Government Pensions Scheme. Last year the scheme cost £5.5 billion - a hefty chunk of Council Tax bills. Already councils pay far more into the scheme than their employees and if nothing is done the gap will widen.
The report says:
- Employee contributions could be raised, but tapered to discourage members on lower salaries from opting out.
- Savings could be made by raising the normal retirement age and reducing the rate at which pension benefits are earned.
- Local pension funds could be allowed more discretion to adjust the level of benefits offered to pension fund members.
- Local government employers should keep liabilities in check by controlling wage costs.
Communities Secretary, Eric Pickles says:
"Town hall pensions are now costing hundreds of pounds a year to every household.
"A massive take of everyone's council tax bill is going on pension costs, rather than emptying bins weekly or cleaning the streets.
"Local taxpayers simply cannot afford to foot an ever-growing bill for town hall pensions, especially for highly paid senior officers and town hall chief executives.
"Today's report highlights the need for change, to ensure fairness for all."