Fife Council has pledged to honour its pensions obligations to employees, despite being accused of taking a ”complacent view” of its future liabilities.
The council’s Conservative leader David Dempsey questioned whether the public sector should continue to enter into pensions commitments which are, by today’s standards, extremely generous.
While accepting it would be morally wrong to renege on commitments already given, Mr Dempsey said: ”Are we to look forward to a time when the entire council tax take goes into the pension fund?”
He said: ”It may be that the average council pension isn’t large but it’s being funded nevertheless by the taxes of equally lowly paid members of the public who have no chance whatsoever of a similar pension.
”I recently worked out that someone self-employed would have to set aside nine times as much as a public sector employee to get the same pension. That surely can’t be right.”
His comments follow an agreement that the council would pay £330 for every £100 paid by employees for their pensions an increase of £40 from the previous ratio.
Council leader Peter Grant branded Mr Dempsey’s claims as ”ridiculous” and said: ”Fife Council will honour its obligations to employees who have earned the right to a decent pension when they retire.
”I recognise that in the much longer term we’ll need to see changes in our pension schemes. Scotland’s councils have a good record of working with our unions, retired employees and pension fund administrators to agree changes to pension schemes when necessary and if Westminster would just keep out of the way I’m confident we will continue to do so.”
Mr Grant challenged the Conservative leader to join him in demanding that the UK Government ditches the ”unwelcome and unnecessary” cuts it plans to impose on pensions right across the public sector in Scotland.
He said: ”These cuts, and the welfare benefit cuts being imposed at the same time, represent a huge threat to the standard of living of thousands of ordinary Fifers.”