Time to end the Final Salary Pension Imbalance?
Whilst I am a wildly optimistic about the Lib-Con coalition and pleased that you have been able to deliver plans for your £6billion of savings in 2010, I feel now is the time to take some hard decisions on how to save real money in the long term. One of the obvious areas for review is that of public sector pensions, including of course your own.
Traditionally a public sector career came with a lower salary than that which could be expected in the private sector, but with the added benefit of an excellent final salary pension and fairly safe long term job prospects. Over the last decade or so this situation has clearly changed dramatically in the sense that on average public sector employees are being paid on a par or in excess of their private sector counterparts, but still with the “gold plated” pension and other benefits.
Given that the private sector has now almost completely abolished the concept of a final salary pension might I suggest that it is high time for the public sector to do the same? If this is too radical a step then perhaps in the spirit of compromise and coalition then public sector employees could be given a choice between continuing with their final salary pension but with a reduced annual salary to compensate for the cost of purchasing such benefits in the private sector.
Just a thought…