Council Spending Uncovered 3: Pension Contributions

Download the full report (PDF).

Andrew Allum, Chairman of the TaxPayers’ Alliance, said:

“It’s unacceptable that ordinary families and pensioners who struggle to pay inflated council tax bills see so much of their money spent on gold-plated council pensions that have all but disappeared in the wider economy.  With pension costs jumping 13 per cent in one year, the problem is clearly getting worse and requires urgent attention.  Councils should start correcting their own behaviour immediately, and the Government must face down union pressure and reform the outdated local government pensions scheme as soon as possible.”

Blogs

4.30pm, Burning Our Money
Mike Denham:
The Cost of National Pay Scales

Taxpayers in London and the South East are almost certainly getting worse public services than those elsewhere in the country. Their schools and hospitals will be staffed by less experienced and lower quality personnel... - Read More

10.50am, Economics 101
Matthew Sinclair:
London losing its edge

A huge share of Britain's GDP, tax revenues and exports are dependent upon financial services and the continuing ability of London to attract investment in this vital industry... - Read More

10.00am, Better Government
Matthew Sinclair:
Priorities in Government

It's like Northern Rock's Chief Executive choosing to spend his time scrutinising orders for paperclips... - Read More

Media Coverage

- £4.6bn council tax for staff pensions

"Pensions for council staff are costing the equivalent of a fifth of all council tax revenues, according to a report by the Taxpayers' Alliance [TPA]. Out of a total £22.2 billion paid in council tax by households last year, £4.6 billion, or 21 per cent, went to the Local Government Pension Scheme, the report claims.

Andrew Allum, the chairman of the TPA, said: "It's unacceptable that ordinary families and pensioners who struggle to pay inflated council tax bills see so much of their money spent on gold-plated council pensions that have all but disappeared in the wider economy.''" - Full Article

- Pensions 'taking up' council tax

"Rises in council tax are being taken up by the rising bill for workers' pensions, a campaign group says.  A report by the Taxpayers' Alliance says spending on local government pensions rose 13% last year to £4.6bn.  For every £5 in revenue raised by local authorities, more than £1 now goes to fund staff retirement, it says." - Full Article

- A fifth of your council tax is paying for 'gold plated' pensions at the town hall

"The report by the TaxPayers' Alliance will anger millions of council tax payers whose bills have nearly doubled since Labour came to power.

In 1997, the average Band D bill was £688. Today, a family in the same size house would pay £1,321.

Andrew Allum, of the campaign group, said: "It is unacceptable that ordinary families and pensioners who struggle to pay inflated council tax bills see so much of their money spent on gold-plated council pensions that have all but disappeared in the wider economy." - Full Article

- Council tax increase 'pays for pensions'

"Overall, spending on local government pensions rose 13% last year to hit £4.6bn, according to figures obtained by campaigning group the TaxPayers' Alliance." - Full Article

Comments

[S. Elkins]

The comments by Brian Strutton of the GMB in response to your report is a frivolous response, he should be made to acknowledge the difference in enhanced benefits generated by switching the Local Auth Workers scheme to 60ths for every year of scheme membership of final salary instead of 80ths,notwithstanding the flexibility of potential to retire early given up by the scrapping of the rule of 85 and the slight increase in the employee's contribution. In this era of pension change for the last ten years, for almost all sectors of society Local Authority workers should be no longer paid relatively low salary with the enticement of a good pension scheme, they should be paid the private sector rate and a commensurate style of pension scheme that they can choose to pay more into out of salary should they wish. Another example of why the state pension scheme should be enhanced and be made compulsory to all National Insurance payees as a decent basic level of income to be supplemented by employer schemes or private schemes as workers choose dependant upon their retirement expectations. Council Tax needs to be as transparent as possible!

[J D Bev]

The blame for this state of affairs lies with the Government!
One of the first things Gordon Brown did when he became Chancellor was to raid the Dividends paid on Pension Funds.
Prior to this raid the Shropshire County Pension Fund was fully funded. That is the income from both employers and employees contributions paid for retired members pensions.
The Chancellors raid meant that the Council Tax payers have had to make up the increasing short fall.
Local Government workers have had to pay a contribution to their Pensions and are NOT getting them free. They also pay income tax.