Are government pensions unfair for the younger generation?

Document type
Hanton, Angus; Kingman, David
Intergenerational Foundation
Date of publication
1 April 2012
Poverty Alleviation Welfare Benefits and Financial Inclusion
Social welfare
Material type

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In this report the Intergenerational Foundation examines the intergenerational fairness of pensions in the public sector (civil servants, teachers, the armed forces, the police and NHS staff). The quality of pensions available to public and private sector workers has become increasingly polarised in recent years, raising the prospect of a serious intergenerational injustice. Through their taxes, younger workers in the private sector have to pay for unfunded public sector pensions that are likely to be much higher than anything they will themselves receive in the course of their own retirements.

The pensions debt, to be paid by future generations, is increasing rapidly because the government is not putting aside anything to meet its obligations to employees. The report suggests some policy options, including taxing high public sector pensions and eliminating pension benefits that are not contractually guaranteed, including from future earnings.