WHAT ABOUT OUR PENSIONS?
Posted on 18/10/2010 by Mark Botham
The interim report was released on 7th October. For more details of the Hutton report see:
You will note, but are unlikely to have seen reported, that Lord Hutton comments “I have been struck both by the enormous complexity of the subject matter, as well as by the degree of misunderstandings and confusions that surround any debate about it. My report tries to dispel some of these myths. It is mistaken to talk about ‘gold-plated’ pensions as being the norm across the public sector. In the most part, the pensions that are paid out to public service employees when they retire are fairly modest by any standard, although in part these reflect part-career or part-time working.”
The recommendations are not scheme-specific and there is no suggestion as to how far contribution rates should rise. This means that there is no definite indication as to the implications, if any, for police pensions. In its report, the Commission concludes that the cost of funding public sector schemes has risen, within an increasing burden being shouldered by the tax-payer. According to the Commission, in many public sector pension schemes, at the time when they were initially established employees paid approximately half of the cost of funding those schemes, while today they pay somewhere between a fifth and a third of the cost of accrual. Although the Commission does not make this explicit, members of police pension schemes are at the top end of this range. The report also notes the relatively high contribution rate of police officers. While drawing no conclusions from this, it is also worth noting that the report contains far more analysis of the Local Government and NHS Pension Schemes.
The Local Government Pension Scheme (LGPS) is available to all councillors and elected mayors of an English county council, district council or London borough council or of a Welsh county council or county borough council who are offered membership of the scheme under their council’s scheme of allowances and who are under age 75.
These councillors pay 6% of their allowances as a councillor into the LGPS. If they pay tax then they get tax relief on their contributions at the time they are deducted from their allowances and if they pay National Insurance they will pay a lower rate of NI contributions up to State pension age. The council pays the rest of the cost of providing LGPS benefits, which costs the council about double the amount the councillor pays.
And at a national level MPs have their own scheme. The Parliamentary Contributory Pension Fund (PCPF) is a funded final salary scheme, where Members pay a fixed contribution, and the Exchequer is liable for the balance. Until relatively recently members could opt to make contributions of 10% of their salary and accrue (or build up) pension at the rate of 1/40th, or to make contributions of 6% of their salary for pension build up rate of 1/50th. With effect from 1 April 2009, a third option was introduced, for Members to contribute at a lower rate and accrue pension benefits at a rate of 1/60th of salary.
If you want to know more about this scheme then visit http://www.parliament.uk/documents/commons/lib/research/briefings/snbt-01844.pdf
Latest Announcements
Death of Brian Nolan
It is with sadness that I report the death of Brian Nolan a retired dog handler from Scarborough died suddenly this morning.
read moreNATIONAL PRESS RELEASE
There has been an update to the previous article "Health & Safety for Cops under attack".
read morePENSIONS TAX RELIEF
Dear Colleague Please find attached for your information a briefing note on the reduced Annual Allowance which will come into effect from 6 April 2011.
read moreLibertys Second Reading Briefing
Libertys Second Reading Briefing on the Police reform and Social Responsibility Bill in the House of Commons.
read moreRegulation A19 and the cessation of 30+ and 30++
The ‘In the Loop Extra’ which was sent out during week commencing 22nd November 2010 has caused serious concern amongst our members.
read moreWhat is happening with our shifts?
Nigel Day the JBB Secretary has been leading for the Federation on the proposed changes to shifts.
read moreUnderstanding the deal: placing the employee at the heart of the employment relationship
The Work Foundation has produced a report which outlines a conceptual framework of the employee’s perception of how their relationship with their employer is forged, sustained and re-negotiated.
read moreWork-related stress
The European Foundation for the Improvement of Living and Working Conditions has produced a report which examines the issue of work-related stress in the 27 EU Member States and Norway.
read moreFront Page - Times Newspaper - 4 December 2010
You may have seen the following which appeared last week.
read moreWe need your help re 2011 Police Bravery Awards
The Police Bravery Awards 2011 will be held at the Savoy Hotel London on 7th July 2011.
read moreNational Detective Forum and Slater Menswear
Slaters will sponsor the Police Federation National Detective Froum for every new interest-free account opened.
read more
