In Council pension time bomb the campaign group said in 2010/11 there were fewer than 1.6 active members of the Local Government Pension Scheme for every one drawing a pension. This compares to nearly 1.9 active members for every one drawing a benefit five years earlier and 3.2 people of working age for each person of State Pension Age and over in the wider UK economy.
Its analysis also found that there were 910,000 former local authority employees drawing a pension in 2010/11, compared to 1.5 million active members. This picture was ‘even more alarming’ when the one million deferred members of the scheme – those no longer working at councils but not yet eligible to draw pensions – were taken into account.
Matthew Sinclair, director of the TaxPayers’ Alliance, said the LGPS faced a ‘bleak future’ and called for changes that meant workers who would benefit most from the scheme paid more towards the cost of their benefits and to ensure taxpayers aren’t left with a ‘ticking financial time bomb’.
But the LGA questioned the ‘simplistic and misleading’ analysis, which it said reached several ‘flawed and inaccurate’ conclusions.
Sir Steve Bullock, chair of the LGA Workforce Board, said: ‘The LGPS funds in England and Wales hold £145bn in investments and assets, enough to pay benefits for more than 20 years.
‘The scheme currently has £4bn more being paid in each year than is taken out, and the amount councils allocate to pension contributions represents just a small fraction of their budgets.’
Bullock said the LGA was working with unions to ensure the LGPS was sustainable with proposals for a new way of running the scheme submitted to the government. This new system could come into effect in April 2014 he said.