New pension plan 'will save millions'

18 February 2008 / by None
A new pension scheme has been introduced for Scottish government workers which is set to save taxpayers some £20 million a year.

The scheme is based on final salaries and years in service and will cover around a quarter of a million people, reports the Scotsman.

It has been developed by the Scottish government along with the Convention of Scottish Local Authorities (Cosla) and unions who are confident that it offers "excellent" benefits, says the report.

Commenting on the introduction of the scheme, Pat Watters, the president of Cosla, said: "I think it is fair to say that when we started these negotiations nobody thought that we would achieve such a good result. We have a scheme which is affordable and sustainable."

Under the new scheme, employee contributions will increase from 5.9 per cent of their pay to around 6.3 per cent, while employers contributions will drop to around 13.3 per cent, according to the report.

In related news, the UK pension regulator's new demands about life expectancy forecasts will add billions to pension liabilities, according to the Times.

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