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Half of all public sector staff will be retiring in the next 10 years, a pension seminar heard last week. The high number is one of the reasons for a revamping of the local government scheme to reduce long-term liabilities, as well as reflect the changing workforce of more part-timers and women. To promote it, pension leaders are set to launch a major publicity drive to alert council employers and staff about the shake-up, which takes effect from 1 April 2008. News that the Local Government Pensions Committee of councillors is to invite tenders for a publicity campaign from PR consultants, starting in late autumn, was revealed at the PPMA seminar last week, held at DCLG offices in Westminster. Terry Edwards, head of pensions for Local Government Employers, said the campaign would include newsletters, CD-ROMS and DVDs, and would be aimed initially at council pension fund managers, and then town hall employers. The DCLG's pensions expert, Brian Town, said 50% of current public sector staff would be retiring in the next five to 10 years. The average period of membership in the local government scheme is six years, although many of those who have been in it longest are also the higher paid. The new-look scheme introduces a sliding scale of employee contributions, ranging from 5.5% to 7.5%. Employer contributions will average 13.2%. The retirement age remains at 65, although voluntary retirement can be 55-60 with the employer's agreement. The final salary scheme will be based on the best year of an employee's final three, or an average of three in 10 for lower-paid staff. The accrual rate will be 1/60th each year, instead of the current 1/80th. The ‘85-year rule' – enabling early retirement if age and length of service added up to at least 85 – has been scrapped, partly on grounds of age discrimination. Co-habiting partner benefits apply to same-sex partners, backdated to 1988.

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FINANCE

Autumn drive to prepare for pensions shake-up

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