UK - Public sector workers are paying less National Insurance (NI) than the private sector leaving the taxpayer with a £3.5bn ($6bn) bill, a former Downing Street adviser warns.
Altmann explained the lower national insurance payments were given legitimacy by calling them 'contracting out rebates' for pensions.
"They really just represent a hidden pay boost for public sector workers and a hidden subsidy for public sector employers", she said.
Employees in pension schemes that are 'contracted out' receive a 1.6% rebate and employers get a 3.7% rebate on their weekly NI contributions per worker.
In addition to getting it for free as part of their public sector pension deal, they will also still receive the replacement for state pensions at age 60, while state pension age increases up to 68 in future. At least £3.5bn a year of revenue is not being collected today and will have to be made up by future taxpayers.
Altmann said: "This has all been hidden away. Furthermore, even though they are not paying for it, they could actually receive replacement for their state pension at age 60 as part of the public sector pension scheme.
"The rest of the country contribute 5.3% of salary towards the state second pension and state pension age will increase to 68 in coming years."
She added: "Hiding the true costs off balance sheet does not fit with transparent and open government.
"It is time for proper openness about all aspects of public sector pensions. An independent inquiry into the costs, both now and into the future, is long overdue."
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