Last week, Lord Hutton of Furness released his long-anticipated report [pdf] recommending changes to the future of the British public employee pension systems. It contains some pretty stark recommendations, especially in comparison to most of what has been suggested in America.
For instance, while many American public pension reform proposals include changing the pension calculations to the final five years’ salary rather than the final three (to prevent so-called “pension spiking”), Lord Hutton’s recommendation is to calculate pensions based on average career pay. Additionally, he would greatly increase the retirement age in the uniformed services (police, firefighters, military) to 60 years, as much as a 10 year increase. Generally, public sector workers will expect about a five year increase in age of retirement.
Here is what the Hutton Report calls “The Deal,” which helpfully reminds us that what’s really at issue is negotiations between public sector employees and taxpayers.