For those of us beavering away in the private sector and faced with the effort of building up our own retirement pots, it is a little galling to hear that we are each going to have to pay, in addition, for a public sector pension liability of around £30,000 each.  For this analysis, I am indebted to Steve Bee of Scottish Life who publishes an excellent blog on all matter relating to pensions.

Now, the good news is that this will be painlessly extracted from us in future taxation.  The bad news is that the Government seems unwilling to tackle the problem.  It did try to reform the Civil Service Pension just before the last election but backed down in the face of untimely threatened strikes just as they were asking for our votes.

Of course, the real problem is partly that most public sector schemes are deeply in the red (not great news for Council Taxpayers) but mainly that the Civil service Pension is unfunded.  There is no Civil Service Fund, as such, retiring members simply continue being paid on a reduced salary, so there is no chance of investment returns helping in any way.  The Government is set to introduce a poorly designed National Pension Scheme in the next few years and to exhort us to contribute, it would be well to think of nibbling away at the Public Sector deficit by starting to save towards that as well.  In the short term, costs rise,but the longer term savings should make it worthwhile.  The other option is for Civil Servants to have ordinary pension schemes like everyone else but that seems unlikely for now.