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Date: 4 March 2010

Taxpayers' Alliance gets its sums wrong on local government pensions again

UNISON has accused the Taxpayers' Alliance of deliberately manipulating figures to suit their claims that local government pensions face a black hole*.

The TA, a tax-cutting pressure group, in comparing liabilities to assets, is deliberately making a ridiculous assumption that everyone will retire at once, tomorrow.

The local government pension scheme is affordable and sustainable and its income exceeded expenditure by almost 6 billion in the last year.

Dave Watson (UNISON Scottish organiser), said: "The so-called Taxpayers' Alliance deliberately distorts the true picture to suit their claims and their tax cutting aims. Their claims are based on the nonsensical supposition that everyone is going to retire at once, tomorrow. Neither do these pensions cost 1 of every 5 of council tax, because council tax makes up only a small percentage of funding.

"Local government pensions are affordable and sustainable. A new scheme has recently been agreed that increases staff contributions. They are funded by employers, employees and by investment income. The LGPS generates one-third of its own income, and contributions from employers in Scotland are going down.

"Remember, too, that we are not talking about gold-plated pensions, here. Local government workers like classroom assistants, home carers, social workers, refuse collectors, and dinner ladies, contribute all their working lives to gain a pension that averages just 3,800 pa, yet the Taxpayer's Alliance, would apparently prefer them to have that pension cut and force them to rely on state benefits. What we need is some perspective here and a move away from a race to the bottom on pensions.

"The real pensions scandal in this country is that the majority of company directors can retire at 60, with a final salary pension 25 times higher than the national average which they accrue twice as fast as both their workforce and the public sector workforce. They then campaign for low paid public service workers to take a pension cut.

"The so-called 'Taxpayers Alliance' would be better employed directing their firepower at the real gold-plated pensioners. Big business bosses who award themselves generous pensions while closing decent schemes for their staff. But they won't of course, because this would be biting the hand that feeds them".


* Council pensions report by the Taxpayers' Alliance

Note for editors:


1. It is funded by employer contributions, employee contributions and investment income.

2. It is cash positive - member benefits paid out in 2008-2009 were 5.6 billion against gross income of 10.2 billion.

3. The total value of combined assets in England, Wales, Scotland and NI was 143 billion (in 2008).

4. That's 5 times greater than the largest single pension fund in the UK.

5. Total assets of the 89 LGPS funds are equivalent to 10% of GDP.

6. 60% of the fund is invested in equities or shares - in UK and global stock markets.

7. By 2008, more than 1 billion was invested in each of the top four FTSE companies and it owned 1.3% of seven of the top nine companies in the UK.

8. 4.7 billion invested in the big four banks - Barclays, HBOS, HSBC, RBS and

9. 2.3 billion in the 49 largest companies delivering UK public services in local government, the NHS and the utilities.