MPs' pensions feel the squeeze
Monday, 26 July 2010 12:00 AM
By Rebecca Burns
Attempts to bring MPs' generous pensions into line with the private sector are to be proposed this week.
The SSRB (Senior Salary Review Board) will recommend a number of measures aimed at cutting the estimated £200 million cost to the taxpayer of MPs' hefty pensions, forecast over the next 15 years.
A senior government source told the Telegraph newspaper: "This is about trying to drag MPs back into the real world and get them more in line with what happens in the private sector.
"MPs' pensions have been seen as the most generous around and this will be a significant part of the debate."
The proposals follow harsh cuts of 25% to government departments, a recruitment freeze in the civil service and a more severe pension scheme at the BBC.
A key change for the MPs' pension will see it linked to average salary as opposed to the current, more generous, final salary scheme.
This means, unlike the current payout, the pension will be proportionate to the length of time served.
Other changes will raise MPs' retirement age from 65 to 68 and forbid accumulation of annual benefits at a rate of no more than one-sixtieth of total salary, down from one fortieth.
The recommendations will be reported on in spring next year.
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