Public sector pensions

Public Accounts Committee Closed Inquiry
Opened: 8 Feb 2021 Closed: 5 Aug 2021 Parliament page
As at 31 March 2020 the UK’s major public service pension schemes had over 8 million members, including active and deferred members and current pensioners – a significant part of the national pensions “landscape”. Most of the main public service pension schemes are unfunded, with pension payments paid for out … Read more
10 Recommendations
15 Conclusions
1 Report
1 Oral session
1 Letter
1 Event
Activity timeline 4 events
2 Sep
2021
Report published
11 Jun
2021
Report published
19 May
2021
Correspondence
22 Apr
2021
Oral evidence
Oral evidence sessions 1 session
22 Apr 2021
View on parliament.uk
Affordability of public sector pensions; Supply chain financing and the operation of Covid finance facilities; Equitable Life
Cat Little · Cabinet Office Charles Roxburgh · HM Treasury Martin Clarke · Government Actuary’s Department (GAD) Mike Williams · HM Treasury Sir Tom Scholar · HM Treasury
Title HC No. Published Items Response
Sixth Report - Public Sector Pensions HC 289 11 Jun 2021 25 Responded
Recommendations & Conclusions
6 results
Clear
11 Conclusion Not Addressed
Sixth Report - Public Sector Pensi…
In both of these cases, the government knew these issues had the potential to arise...
In both of these cases, the government knew these issues had the potential to arise and could have avoided them. In the case of the McCloud judgement, government was advised that special transitional protection could potentially be in breach of … Read more
Government Response
The government's response states its belief that the 2015 public service pension reforms meet objectives and that it is focusing on completing their implementation, without addressing the committee's finding that trust between stakeholders has been undermined.
HM Treasury
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12 Conclusion Not Addressed
Sixth Report - Public Sector Pensi…
As a part of its 2011–2015 reforms, HM Treasury made a commitment that there would...
As a part of its 2011–2015 reforms, HM Treasury made a commitment that there would be no more reforms for 25 years. HM Treasury told us there are no intentions for further cross-government reform, but that it is something it … Read more
Government Response
The government reiterated its belief that 2015 reforms meet objectives and is focused on completing implementation, but did not address the committee's observation about substantial issues arising just six years into a supposed 25-year commitment, or concerns about long-term sustainability.
HM Treasury
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14 Conclusion Not Addressed
Sixth Report - Public Sector Pensi…
HM Treasury said that its focus remains on implementing the 2011–2015 reforms in full and...
HM Treasury said that its focus remains on implementing the 2011–2015 reforms in full and that its reforms will have an impact over the very long-term. HM Treasury acknowledged there will come a point where it will need to undertake … Read more
Government Response
The government reiterated its belief that 2015 reforms meet objectives and is focused on completing implementation, but did not address the committee's note that HM Treasury acknowledged a future need for detailed evaluation.
HM Treasury
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16 Conclusion Not Addressed
Sixth Report - Public Sector Pensi…
Pensions are also a significant cost to public service employers.
Pensions are also a significant cost to public service employers. In 2019–20, employer contributions across the four main public service schemes rose in real terms by £6.4 billion, to £23.3 billion (around 24.3% of total payroll).34 This substantial increase has … Read more
Government Response
The government described the quadrennial valuation process for determining employer contribution rates, with the current valuation underway, but did not address the committee's observation about the specific £1.7 billion increase funded by employer budgets and its impact on frontline services.
HM Treasury
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17 Conclusion Not Addressed
Sixth Report - Public Sector Pensi…
As a direct result of concerns about these increasing contributions, around 200 independent schools are...
As a direct result of concerns about these increasing contributions, around 200 independent schools are set to withdraw from the Teachers’ Pension Scheme. HM Treasury told us that the Department for Education has worked very closely with the Teachers’ Pension … Read more
Government Response
The government explained that employer contribution rates are determined by four-yearly valuations, with the March 2020 valuations currently underway. It did not address the committee's specific concern about independent schools withdrawing from the Teachers' Pension Scheme or the pressure on remaining schools.
HM Treasury
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18 Conclusion Not Addressed
Sixth Report - Public Sector Pensi…
The employer contribution rate is next due to be implemented in 2024, where it may...
The employer contribution rate is next due to be implemented in 2024, where it may change again. Both the SCAPE discount rate—which is a key assumption used to help set the employer contribution rate and drove the 2019–20 increase in … Read more
Government Response
The government described the general quadrennial valuation process for employer contribution rates, with current valuations underway, but did not specifically confirm or elaborate on the stated review of the SCAPE discount rate and its methodology prior to 2024.
HM Treasury
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Government Response AI assessment · 25 of 10 classified
Accepted 10
Accepted in Part 2
Acknowledged 4
Deferred 2
Not Addressed 6
Rejected 1
Total 10 recs + 15 conclusions
Correspondence 1 letter
19 May 2021 Correspondence from Catherine Little, Director General Public Spending Head of Government Finance Function, HM Treasury, re Public Accounts Committee – Session of 22 April 2021, dated 12 May 2021
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