Police pensions ‘unaffordable’
By Oliver Hotham
Pensions for police officers are costing the taxpayer £2.5 billion a year, according to a report out today.
Thinktank Policy Exchange said rising life expectancy and fewer active members were responsible for the high cost, which has risen from less than £1 billion in 1991.
Two police authorities told researchers the cost of supporting retired officers is higher than that of supporting active and deferred members combined.
Edward Boyd, who wrote the report, said the police pension scheme was in dire need of reform.
"Police officers' pensions have become increasingly unaffordable for taxpayers. A growing pensioner population, primarily down to increased life expectancy coupled with only minimal changes in the retirement age, has increased costs substantially over the last decade," he said.
"The more we have to pay for pensions, the less police forces have available to spend on hiring officers to fight crime.
"We desperately need a new police pension scheme fit for the modern world. Without reducing costs, police officer pensions will become unaffordable for taxpayers and for officers themselves."
The report recommends police forces move away from a final salary to a career-average system, the raising of standard retirement age to 60 and, in the longer term, the design of a whole new scheme for dealing with police pensions.
Without reform, it argues, by 2036 pension funds will have become so inflated that all officers receiving their full pension entitlement will have a fund worth at least £500,000.