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Call for rise in government workers' pension contributions

 

The Island's public sector workers face paying more for their pensions in future as government faces a major funding 'gap' in its staff pension scheme. 

A report to Tynwald says action's needed to make up an estimated 23% shortfall between the scheme's income and outgoings.

The Public Sector Pensions Joint Working Group is recommending  a phased increase of 3%, taking most government staff to a contribution level of 8% of pay.

While the report does not affect current pension schemes for police officers, teachers and the judiciary, similar reforms are likely to be introduced. 

Proposals also include raising the minimum retirement age for current members from 55 to 58, while new joiners will achieve current benefit levels five years later than at present. 

Tynwald members' contributions would rise from 5% to 10% with reduced benefits, and to 15% for those who want to retain current benefits.

The plans have been outlined to public sector unions this afternoon and will be debated in Tynwald next week. 

The working group says its proposals are designed to ensure public sector pension liabilities, currently more than £2 billion, and the future cost of paying staff pensions, are met. 

The measures follow a major reform of the Island's public sector pensions in 2012, when the formation of the Government Unified Scheme (GUS) streamlined 15 separate schemes.

GUS was intended to ensure future viability for public sector pensions, but it has not achieved the savings expected, mainly due to staff cuts in government and early retirement.  

Chairman of the working group Chris Robertshaw says it's time members of Tynwald paid more towards their pensions:  

 

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