County moves to calm pension fears
Warwickshire County Council has commented on claims that the pensions liability for council workers is too costly to manage.
The Audit Commission has published a report warning that the Local Government Pension Scheme has funds to cover about three-quarters of its future liabilities, and cautioning that the current approach cannot continue indefinitely because of increasing life expectancy and the need to recover deficits.
However, the deputy portfolio holder for Resources, Cllr David Wright who sits on the Council’s Pension Fund Investment Board, moved to quell fears that the bill for county council workers is adversely affecting taxpayers.
Cllr Wright said, “There is a misconception that local government pensions are a lucrative end to the working life for local government employees but this is not the case at all. In fact, the current average local government pension is around £4,000 per annum and the provision of such a pension results in many recipients not needing to claim benefits from the state.”
“I would like to reassure council taxpayers that the Warwickshire Pension Fund is performing very well at present, especially compared with similar pension funds across the nation. At the last valuation, Warwickshire’s pension fund was 86% funded and we have a funding strategy in place to recover the shortfall over the medium term. We have also fully taken account of the increases in longevity which we expect to see.”
“Warwickshire’s Pension Fund has a positive cash flow with dividends and interest from its investments and contributions comfortably and consistently exceeding expenditure on benefits every year. The Local Government Pension Scheme is one of the few public sector schemes that has a significant source of funds in place to finance its future liabilities.”