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CBI calls for review into public sector pensions

The CBI is calling for an independent commission to examine the financial rules, costs and levels of taxpayer subsidy that underpin public sector pensions.

It is also proposing the retirement age for public sector employees be pushed back from 60 to 65 – in line with private sector retirement and the state pension age.

In a report launched today, the employers’ group says the Government must “come clean” to taxpayers about the “ballooning” cost of public sector pensions, which it says is approaching £915bn.

The CBI believes a review would kick-start a debate on the reform of the pension schemes. It says the majority of public sector pensions are unfunded and will place a massive and growing burden on future taxpayers.

Deputy director-general John Cridland says public sector workers should have a good retirement but there needs to be an open debate about how the bill is split.

He says: “The debt that is being racked up is truly eye watering and is set to get much worse. Taxpayers who are struggling to build their own personal pension will be lumbered for decades by the cost of covering public sector workers who retire years earlier on risk-free pensions. The private sector has had to face up to what its pension commitments will cost and has made huge efforts to put its own house in order. All we ask is that Government does the same for its five million employees. We do not know enough about the problems that these pensions are storing up. An independent commission would shine a light on the real cost of public sector pensions, and could help lighten the load for taxpayers.”

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