Reforming public sector pensions

This Pensions Policy Institute (PPI) is seeking to provide an independent evidence base to help policymakers to understand the implications of alternative policies for public sector pensions. Its latest report, The future of the public sector pension schemes concludes that a trade-off between adequacy and affordability is at the heart of reform.  

What does the report do? 

• Identifies the policy objectives that any Government considering further reforms to the public sector pensions might aim to address.

• Identifies a set of possible further reforms for the public sector pension schemes that the Government could consider.

• Analyses a set of possible reforms against the identified policy objectives and identifies what the implications of such reforms might be for public sector employees, and for the overall affordability and sustainability of the schemes.

In the report, the PPI assesses a range of reform options that the Government could consider in reforming the public sector pensions ranging from:

• Continuing with current policy;

• Amending the existing final salary schemes;

• Introducing risk-sharing arrangements such as career average or hybrid arrangements; or

• Moving to a funded or notional defined contribution arrangement.