UK – The UK government projects that public pension spending will rise by 0.9 billion pounds (E1.3 billion euros) – on top of current expenditure – within the next four years.

“National accounts pensions expenditure, which is recorded on a transactions basis, shows only small changes in 2004-05 and 2005-06, but increases in 2006-07 by 0.3 billion pounds and by 0.9 billion pounds in 2007-08,” the Treasury stated in the pre-budget report released today.

It said: “This reflects decreased estimates for the NHS pensions scheme and, in particular, the Principal Civil Service Pensions Scheme (PCSPS).”

The PCSPS – named renamed 'Classic' – is a traditional occupational final salary scheme which closed in 2002. It pays a pension based on 1/80th of final pensionable pay for each year of, plus a tax-free lump sum of three times pension.

Net public service pensions figures are reported using the FRS17 accounting standard and record changes in the accruing liabilities of the various pensions schemes, the report points out.

The government report also says that the impact of the new Pension Protection Fund on economic projections.

“The projections do not take account of decisions where the impact cannot yet be quantified, such as the Pension Protection Fund,” the report stated.

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