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Public sector pension schemes are growing

It has been revealed that the U.K.'s four largest public sector pension schemes saw a 56% increase in employee contributions between 1999/2000 and 2008/09. While this would appear to be a good move on behalf of taxpayers, in reality the vast majority of the extra income was created by a large number of new members, although there was an increase in contribution rates.

On the other side of the coin it has also been revealed that over the same period government pension payments to those in the schemes increased by a significant 38% to £19.3 billion. These are public sector pension schemes which are on the whole unfunded with UK taxpayers left to foot the bill, something which has led to a significant increase in taxpayer contributions to the schemes, much to the anger of the UK public.

It was also revealed that the UK authorities believe payments from all UK public sector pension schemes will increase to around £79 billion a year in 2059/60 although it is hoped that much of the increase in liabilities will be covered by larger employee contributions. However, this is something which is causing significant friction between the UK government, unions and pension scheme members although it will need to be addressed sooner rather than later.

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