Pension Liabilities

Public Sector Pension Liabilities close to £1 Trillion

Conservatives have called for far-reaching pensions reform after it emerged that the true cost of public sector pension liabilities is now more than 80 per cent higher than the Government's latest official estimate - amounting to £40,000 per household in the UK.And Shadow Work and Pensions Secretary Philip Hammond has demanded greater transparency as the big debate on the future of pensions funding - covering private, state and public sectors - gets underway.

He called for action after the actuarial consultants, Watson Wyatt, estimated that the accrued liabilities in all unfunded public sector pension schemes stands at £960 billion - in contrast with the Government's own estimate of £530 billion.Mr Hammond said: "It is worrying that the Government are continuing to play down the size of public sector pensions liabilities. This latest estimate of £960bn is some £430 billion higher than the Government's own estimate and represents 80% of UK GDP."

He declared: "We need greater transparency in the accounting treatment of public sector pension liabilities. The Government must be open and honest about the rapidly growing public sector pension deficit if it really wants a 'national debate' on the future of pension provision."Mr Hammond said: "It is now clear that we need far-reaching pension reform across all pension provision in the private, state and public sectors."