Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the long-term (1) cost, and (2) sustainability, of public sector pensions; and what assessment they have made of how such pensions compare to those paid in the private sector.

The Independent Public Service Pension Commission led by Lord Hutton recommended in March 2011 that projected public service pension benefit payments as a percentage of estimated future GDP is the most relevant measure of their future affordability. This is because most public service pensions are financed through taxation, which is closely related to GDP.

The Office for Budget Responsibility forecast in 2022 that spending on public service pensions will fall from 2 per cent of GDP at present to 1.7 per cent by 2071-72. An updated forecast is expected to be published in the near future.

Remuneration in the main public sector workforces tends to be weighted towards pension relative to pay compared to packages typically available in the private sector. The total remuneration package needs to be considered when making any comparisons. The recommendations by the independent Pay Review Bodies for the main public service workforces take account of the total reward for each workforce, including the relevant pension scheme.