Councils could slash worker pension contributions after retirement fund records huge surplus

dailyrecord.co.uk:

Councils could slash the amount they pay into workers’ pensions after a retirement fund posted a massive surplus.The plan, to be discussed by Strathclyde Pension Fund today, could unlock tens of millions of pounds for local authorities.A senior council source said: “It is a once in a decade opportunity.”Twelve local authorities, including Glasgow, South Lanarkshire and North Lanarkshire, are part of the multi-billion pound SPF.A new paper reveals the Fund is flush with cash and is funded to the tune of 147 per cent.The proposal is to cut the amount councils pay into worker pensions from 19.3 per cent to 6.5 per cent over the next two years.It would then rise to 17.5 per cent from 2026.The paper states: “This preliminary analysis confirms that the very strong funding position allows some flexibility to reduce contribution rates as part of the funding strategy adopted at this valuation.”Supporters say it would not impact on the guaranteed rights of pensioners but would free up a huge amount of money for cash-strapped councils.However, Labour is concerned any savings for the twelve councils could be clawed back by the Scottish Government.

Jill Brown, Glasgow Labour’s Treasurer Spokesperson, said: "We strongly urge the City Administration Committee and Scottish Government to provide assurances that the proposed changes will not be used as an excuse to reduce funding to Glasgow City Council. "Our services are already at an all-time low, and we must use this opportunity to invest in technology and secure a sustainable step change in service delivery that will last even after employer contributions increase to 17.5%. "A land grab by the Scottish Government in such a fragile state would be deeply damaging and we would hope that