Independent Public Services Pensions Commission

• The Government should make clear its assessment of the role of public service pension schemes which should be to ensure adequate levels of retirement income for public service pensioners.
• Public service employers take greater account of public service pensions when constructing remuneration packages and designing workforce strategies.
• The Government should ensure that public service schemes, along with a full state pension, deliver at least adequate levels of income for scheme members.
• The Government must honour in full the pension promises that have been accrued by scheme members. This includes the final salary link of all contributions to date.
• Members of the current defined benefit public should be moved as soon as possible to new schemes.
• All public service pension schemes should regularly publish data which is produced to common standards and collated centrally.
• A new career average revalued earnings (CARE) scheme should be adopted for general use in the public service schemes.
• Pension benefits should be uprated in line with average earnings during the accrual phase for active scheme members. Post-retirement, pensions in payment should be indexed in line with prices to maintain their purchasing power and adequacy during retirement.
• A single benefit design should apply across the whole income range. The differing characteristics of higher and lower earners should be addressed through tiered contribution rates.
• Members should have greater choice over when to start drawing their pension benefits.
• The Government should increase the member’s Normal Pension Age in the new schemes so that it is in line with their State Pension Age.
• The Government, on behalf of the taxpayer, should set out a fixed cost ceiling: the proportion of pensionable pay that they will contribute, on average, to employees’ pensions over the long term. If this is exceeded then there should be a consultation process to bring costs back within the ceiling, with an automatic default change if agreement cannot be reached.
• It is in principle undesirable for future non-public service workers to have access to public service pension schemes.
• The consultation process itself should be centrally co-ordinated. However, the consultation on details should be conducted scheme by scheme involving employees and their representatives.

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