Reforming public sector pensions

This Pensions Policy Institute (PPI) has undertaken an independent assessment of the Coalition Government's proposed reforms to the NHS, Teachers, Local Government and Civil Service pension schemes. The PPI concludes that the reforms will reduce the average value of the pension benefit for members of these schemes by more than a third. 

Across the four largest public service pension schemes the value of the schemes reduces, on average, from 23% of a scheme member’s salary before the reforms to 15% of a scheme member’s salary after the Coalition Government’s proposed reforms.

More valuable than private sector pensions

Nevertheless, even after the Coalition’s proposed reforms the benefit offered by all four of the largest public service pension schemes remains more valuable, on average, than the pension benefit offered by Defined Contribution (DC) schemes that are now most commonly offered to employees in the private sector, which are typically worth around 10% of a DC scheme member’s salary.

The future of public sector pensions

The latest report follows an earlier project to examine the future of public sector pensions, which was also funded by the Nuffield Foundation. Two reports related to this project are available to download from the publications section of this page.