The value of public sector pensions has been cut by a quarter and future reform will need ‘trade-offs between adequacy and affordability', according to the Pensions Policy Institute (PPI).
In a report considering the future of public sector pensions, the PPI assesses the range of reform options including amending final salary schemes, introducing final salary or hybrid arrangements, and moving to defined contribution (DC) arrangements. "The combined impact of the last Labour government's reforms and the coalition government's recent announcement on CPI indexation has reduced the value of a public sector pension to a typical public sector worker by around 25%," says Niki Cleal, PPI director. "As a result, the future cost of public sector pensions is now projected to fall...
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