Annal Nayyar-Pension Deficit increases in Local Government Pensions Scheme

Council employers face the need to  meet a town hall pensions gap that has doubled to more than £80bn in three years, finance experts have warned today- article in Local Gov.

Research undertaken by KPMG, based on data collected by the GMB trade union, indicates the aggregate deficit in the Local Government Pension Scheme has increased from £38bn in 2010 to more than £80bn. This £50bn increase is largely because the values of liabilities, which are linked to gilt prices, have soared by 40%, while assets have seen a hike of around 20%.

From April 2014 town hall bosses must tackle the challenge of setting contribution rates which are both affordable yet sufficient to pay down the overall pension pot deficit.

However, with council employers’ contributions set for an inevitable hike, amid the shift from final salary schemes to career average pensions, there is a risk local government staff might leave LGPS schemes.

Both comments and pings are currently closed.

Comments are closed.