Research shows £4 billion council pension deficit

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SCOTTISH councils have a combined pension deficit of £4.16 billion in 2010-11, new research has found.

A study from campaign group the Taxpayers Alliance has found the local authority in Scotland with the largest deficit in 2010-11 was Glasgow City Council with £625 million.

This is £1,054 per head of Glasgow’s population, the group says.

But the highest deficit per head of the local population in Scotland is Dundee City Council at £1,565 each.

The Local Government Pension Scheme is funded and ideally, a pension fund would have assets that are as close to 100 per cent of liabilities as possible, Taxpayers Alliance says.

The group’s research found across all Scottish councils in 2010-11, the average ratio of assets to liabilities was 82 per cent.

This is 12% higher than the UK average.

Matthew Sinclair, Director of the Taxpayers Alliance, said: “The deficit in the Local Government Pension Scheme remains a ticking time bomb that’s being left for future generations of taxpayers to deal with.

“With an ageing population and a crisis in the public finances, generous final salary schemes like the LGPS are inflexible and too expensive, and need urgent reform.

“Councils should not take false comfort in the improvement in the stock market.

“Their pension liabilities continue to far outweigh their assets and the situation remains worse than two years ago.”

 

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