IT HAS recently been widely reported the cost of subsidising gold-plated pensions of town hall staff across the country has cost families almost £400 from their council tax.
Exactly how near the mark this figure is in the Arun District is something ADC seem either unwilling or unable to make clear, even though they have, on several occasions, stated how transparent they are with such matters. Do we really know?
There are two types of defined benefit (final salary) pension schemes.
Some, such as enjoyed by MPs and the Civil Service, are unfunded, therefore are paid directly from that bottomless pit known as the public purse.
However, it is the funded schemes that should worry us all, as the funds in such schemes are vulnerable to the volatility of stock markets and other economic conditions, such as those being experienced across many countries at the present time.
As a now retired company pensions consultant, I have seen the demise of many a company scheme in the private sector due to the unacceptable cost.
This has been mainly due to two areas.
Firstly, the effect of volatile market conditions.
Secondly, to the reversal by Gordon Brown when chancellor of the tax concessions allowed on investment growth in pension funds, effectively taking £5 billion a year from ordinary people’s pensions.
This caused enormous shortfalls in pension funds which employers were unable to rectify: an absolute catastrophe for millions in the private sector.
It therefore surely begs the question.
With people’s expectation of life increasing, how much longer will the public sector, in particular local authorities, be capable of guaranteeing and inflation-proofing staff pensions when, in the present economic climate, they must be experiencing calamitous shortfalls which, so far as local councils are concerned, must be made up within a limited time?
Is central government subsidy being applied or is it all to fall on the shoulders of the council tax payer... if so, to what extent?
Since a great many taxpayers are on seriously inadequate pensions themselves, this must be of great concern to them.
Cambridge Walk, Aldwick