UNITED KINGDOM
The United Kingdom’s Cabinet Office has refused to cut contribution rates to the Civil Service Pension Scheme, despite the cost of the Scheme falling below a threshold that should trigger a reduction.
The Cabinet Office said contributions would be unchanged as an interim measure until a valuation process had been completed.
That process has so far identified that the cost of the Scheme has fallen to a point that trade unions say should trigger a 2 per cent reduction in contributions.
Those contributions range from 4.6 per cent for PS staff earning up to £21,637 (A$40,073) to 8.05 per cent for those earning £150,001 (A$277,810) and above.
However, the Government announced in January that it would pause part of its work on the valuation because of a continuing court case.
Chief Secretary to the Treasury, Liz Truss has said a December judgement from the Court of Appeal on “transactional protection” offered to some Scheme members could have a £4 billion (A$7.4 billion) a year impact on public sector pension finances.
Responding to the decision, General Secretary of the Public and Commercial Service (PCS) union, Mark Serwotka said the union “deplored the imposition of this roll-over of contribution rates into 2019–20, as our members are already paying too much for their pensions, which have dwindled in value”.
“The Government is depriving them of money that is owed to them already, and PCS is considering its next steps to challenge this and obtain justice for our members,” Mr Serwotka said.
London, 16 March 2019
