Police Pensions 'Unaffordable For Taxpayers' Claims Policy Exchange Report

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Police pensions are becoming "unaffordable for taxpayers" with contributions doubling to almost £2bn, a report claims.

Taxpayers are picking up about 80% of rising costs, with police retirement plans in desperate need of reform, a thinktank said.

Total costs now stand at £2.5 billion a year, the equivalent to £1 in every £7 of total police expenditure, the Policy Exchange said.

Taxpayer contributions more than doubled from £951 million in 1995-96 to £1.9 billion in recent years while police officer contributions fell from 31% to 23%, the report said.

The report recommends a move away from a final salary to a career-average scheme and a raising of the standard retirement age to 60.

Edward Boyd, author of the report, said: "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.

"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."

In 1995/96, pensions cost less than £1 billion. By 2009/10, the bill had risen to almost £2.5 billion, the report said.

Rising life expectancy was singled out as a significant reason for spiralling costs.

The data claims two police authorities are supporting the costs of more retired police officers than active and deferred members combined.

In 2009/10, each household in England and Wales was paying £612 a year on policing. Of this, £83 - or £1 in every £7 - was spent on police officer pensions, up from £52 per household a year in 2001/02.

The report says police pensions are the most generous as a proportion of their pay compared to other public sector workers, excluding the judiciary.

Police officers have already been told they will have to pay an average of an extra £1,000 a year into their pension under government plans.

More senior officers, such as mid-range superintendents, face an increase of £2,800 a year while new constables face paying £349 more as annual police pension contributions rise between 1.5% and 4%, depending on rank.

Home Secretary Theresa May said last year there needs to be a "fairer balance between what employees pay and what other taxpayers contribute towards a public service pension".

Anger has been building in frontline policing since former rail regulator Tom Winsor said the most wide-ranging analysis of forces' pay in 30 years showed more than £1 billion of savings should be made.

Prime Minister David Cameron has said there is a need for major change regardless of economic challenges.

But a report by Her Majesty's Inspectorate of Constabulary (HMIC) found crime rates could jump as one in 10 police officers is axed under Government spending cuts.

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Police pensions 'unaffordable'