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Fair Cuts? The Impact of British Public Service Pension Reform on Workers in the Main Occupations

Published online by Cambridge University Press:  22 October 2012

Paul Bridgen  and
Traute Meyer
Paul Bridgen
Affiliation:
Faculty of Human and Social Sciences, University of Southampton E-mail: [email protected]
Traute Meyer
Affiliation:
Faculty of Human and Social Sciences, University of Southampton E-mail: [email protected]
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Abstract

Public service pensions have been a fundamental component of the British pension system in the post-war period and recent reform initiatives have caused political controversy. This article assesses the impact of the Conservative/Liberal government's public sector pension reform plans of 2011 for different public sector workers. It simulates their projected pension outcomes, assuming people contribute to the new system throughout their working lives. In particular, we examine the government's claim that the move away from final to average salary schemes will make pensions fairer for women and lower paid workers. The article shows that the reforms are indeed fair, if measured by the government's standards: retirement is delayed for all, but the lowest skilled and women lose least and some even gain higher pensions without paying proportionately more. Despite austerity, recent British pension reforms reflect a greater awareness of social inequality than many would expect and they have been built on more cross-party agreement than apparent at first sight.

Keywords

Public service pension reformUKfairnesspension outcomesaverage salary schemes
Type
Themed Section on Rethinking Retirement Incomes: Inequality and Policy Change in the UK and Anglo Saxon Countries
Information
Social Policy and Society , Volume 12 , Issue 1 , January 2013 , pp. 105 - 122
Copyright
Copyright © Cambridge University Press 2012

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