Council tax set to rise to plug pension fund shortfall

It has been revealed via a Freedom of information request that 83 of the 87 local government pension schemes in operation in the UK were in deficit in 2007. When you consider that the financial situation has changed for the worse since 2007, we can only assume that the deficit problem has worsened over the last two years. So who will pay the price?

The Liberal Democrat Shadow Work and Pensions Secretary, Steve Webb, has received some interesting information after his request and believes the pension black hole could be in the region of £60 billion. As a consequence it seems inevitable that council taxes will rise in the short to medium term and cuts in services will become more and more apparent. Yet again due to the increase in employment numbers within the public sector, something which Gordon Brown has been criticised for on numerous occasions, taxpayers will again be forced to bail out public sector pension funds.

The very fact that employment numbers within the public sector have continued to rise since 2007 is almost certain to make this situation much worse in the future. While those in the private sector continue to struggle to make ends meet and worry about their own retirement, those in the public sector continue to enjoy final salary pension schemes which are to all intents and purposes guaranteed by the ever poorer taxpayer.