The Government has underestimated the liability of public sector pension schemes by £610bn, according to research by the TaxPayers’ Alliance (TPA).
The campaign group says the liability facing taxpayers for unfunded public sector pensions now stands at £1.7 trillion and has risen by over £1 trillion since 2003-04.
The TPA says the Government has underestimated the shortfall because it uses a more ‘generous’ rate than the private sector to reduce the expected payments in future years.
Jonathan Isaby, chief executive of the TaxPayers’ Alliance, said: ‘The scale of the public sector pension liability is enormous, much scarier than the Government lets on. The situation has rapidly deteriorated over the last decade and will only get worse with an ageing population, meaning our debt mountain will continue to grow.
‘Generous final salary schemes in the public sector are too expensive, unsustainable and need urgent reform so that we don’t leave future generations of taxpayers to pay our bills.’
Funds are saved to meet the expected pension payments for local government.
