UK - Council employee pension contributions will soar by 50% for new members under new government proposals.
Staff contributions to the Local Government Pension Scheme would rise from 6% to 9% and the minimum retirement age would be increased from 50 to 55 while the normal retirement age would increase from 60 to 65.
The proposals have been put forward by the Office of the Deputy Prime Minister which establishes policy for the £83bn scheme.
The measures – which are earmarked to take effect over the next two years – are part of a raft of proposals aimed at reducing costs of running the local government pension scheme.
Local government minister Phil Hope said: “Our strategy will ensure the scheme remains efficient and effective, providing reasonable pensions at an affordable cost to employers, members and taxpayers.”
Greater Manchester Pension Fund head of pensions administration Ged Dale said he welcomed several of ODPM’s proposals, “especially those that affect the amalgamation of service and benefits”.
And West Midlands Metropolitan Authorities Pension Fund chief pensions officer Mike Woodall added: “There is an acceptance that the final salary scheme that we operate is viable into the future, with changes that need to be made in order to ensure not only its continued viability but also its effective administration.”
The forward strategy proposals will be introduced, after consultation, in two phases.
Phase one will include the introduction of immediate vesting and will come into force on April 1, 2004, while phase two – which includes plans to increase employee contribution rates and to increase the normal retirement age – will take effect from April 2005.
PwC, KPMG, EY and Deloitte must break up their consultancy and audit businesses into distinct firms to provide greater focus on the "most challenging and objective audits", the competition watchdog has said.
The Department for Work and Pensions (DWP) has released its first batch of guidance setting out how the guaranteed minimum pension (GMP) conversion legislation may be used to resolve unequal payments.
This week's top stories include the government spending £800,000 on a Gogglebox advert and MPs writing to The Pensions Regulator about its engagement with the Railways Pension Scheme.