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Jim Moore: Has the Government given up on pensions?

Jim Moore
Friday 06 January 2012 01:00 GMT
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Outlook John Ralfe tweaked the Government's nose yesterday, having crunched some numbers on the effect of its planned reforms to public sector pensions.

Mr Ralfe, best known for saving Boots a bundle by radically restructuring its pension scheme and being right quite a lot of the time, says that while public sector workers won't be able to pick up their full pensions until they are 67, the improved package on offer when they get there means the Government won't save a penny. With set increases above CPI inflation, even a pay freeze won't stop the cost of pensions going up and up and up.

No, no, says the Treasury, Mr Ralfe is quite wrong. He's only looking at part of the picture.

Without an actuarial qualification, this boils down to a question of who you believe.

But what Mr Ralfe is really saying is that faced with a noisy and apparently well-supported union campaign, the Government has given in and left it for the next lot to really sort out this ever-vexed issue. If he's right, it would hardly be the first time. And it won't be the last.

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