UK - The number of private sector staff in final salary schemes has plunged to a 40-year low, Government Actuary figures show.
And for the first time, the number of public sector workers in final salary schemes has overtaken those in the private sector.
Latest figures show there are only 4.4m people in the private sector accruing defined benefits, compared to 4.6m in the public sector.
In 1995, the number of private sector staff in final salary schemes outnumbered those in the public sector by 2.1m.
These figures represent the continuation of “the downward trend” in private sector provision since the mid-1960s, according to the government department.
But Buck Consultants head of technical services, Kevin LeGrand, said the figures should not come as too much of a shock.
He said: “The private sector is more flexible and able to react more quickly than the public sector when pressured for change.
“Given the current market putting a lot of pressure on employers to move to DC, you would expect the private sector to lead the way.”
He explained that low pay in the public sector also made it difficult to cut DB provision there.
“Traditionally it has always been said that immediate remuneration in the public sector is lower than that of the private sector, but that difference is made up by DB pension schemes.
“So it makes it more difficult for public sector employers to turn to DC.”
Conservative spokesman Oliver Heald said: “It’s a huge change that leads to a concern that we are developing two nations for pensions provision.
“Those in the private sector with not the option of final salary scheme are at the same time paying the taxes to sustain the public sector schemes.”
He blamed Gordon Brown’s £5bn-a-year tax credit charge which has undermined private sector schemes, coupled with stock market volatility.
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