UK - Local authorities will not have to raise council taxes to clear the West Midlands Superannuation Pension Fund's £1.3bn deficit, chief pensions officer Mike Woodall (pictured) insists.
Woodall stressed there was no crisis within the scheme – which handles the pensions of workers in Birmingham, Solihull, the Black Country and Coventry – and a rise in council taxes would not be necessary to clear the shortfall.
He said: “When the poll tax was introduced the government of the day reduced the solvency levels required of local government pension schemes to 75%, which I believe is the level many funds will be at when the 2004 figures are revealed. If there wasn’t a crisis then, why is there one now?
“People are making a crisis out of an issue that doesn’t merit it, and I wonder about the motivation behind it.
“The private sector has seen a lot of its final salary schemes wound up, and I believe they are looking at the public sector with some jealousy. But it is important to look at the remuneration package as a whole. Employers pay more into schemes in the public sector, but pay is generally not as high.”
Woodall believes the deficit could be cleared within 20 years if employer and employee contributions rise by one percentage point a year.
“Faced with a choice of an inferior pension scheme and a slight increase in contributions, I believe people would much rather pay more for a secure future,” he said. “And an increase of that size will not result in a hike in council tax.”
The West Midlands deficit is indicative of the shortfalls in local authority pension schemes across the country.
The London Borough of Croydon has discussed raising council taxes to address its £254m deficit while Islington Council in north London admitted some of its services would have to be sacrificed to make up its £200m gap.
The Pensions Regulator (TPR) and Labour MP Stephen Kinnock and will listen to the experiences of steelworkers when transferring their pensions away from the British Steel Pension Scheme (BSPS) next week in Port Talbot.
Just Group has acquired a 75% stake in the holding company of Corinthian Pension Consulting in a bid to strengthen its professional defined benefit (DB) advisory services.
The Pensions Regulator (TPR) has exercised its production order power under the Proceeds of Crime Act 2002 for the very first time as part of a fraud investigation.
The ITN Limited Pension Scheme has named Trafalgar House as its administrator for an initial term of five years.