Reform Scotland

Politicians engaged in a “conspiracy of silence” on pensions, says think tank


Reform Scotland calls on all parties to ‘grasp the nettle’ on pension reform before more damage is done

Reform Scotland, the independent non-party think-tank, has accused successive Westminster governments of being engaged in a ‘conspiracy of silence’ on pensions. Ahead of the release of a major report containing its recommendation for an entirely new pension system and structure, Reform Scotland has accused politicians of failing to be clear with the country about the realities of our pension system and what may face today’s workers in their retirement.

Reform Scotland claims that the current pension system – including the state pension and public sector occupational pensions – suffer from “The 3 U’s”:

  • Uncertain – current workers, especially younger ones, have no idea at what age they’ll be able to collect a state of public sector pension or how much they’ll get; indeed, the politicians who’ll make that decision may not be born yet
  • Unfunded – we often see ‘hands off my pension’ protests, but there is no pension pot for anyone to get their hands on because today’s NI contributions and employee contributions almost entirely pay for today’s pensioners; they are not going to a personal pot for the employee who’s paying them
  • Unsustainable – the state pension already comprises 14% of Scottish public sector expenditure and Scottish public sector pensions take up 8% of the Scottish Government’s budget; and there’s going to be a 25% increase in the number of pensioners in the next 20 years

Commenting ahead of the release of the report, Ben Thomson, Chairman of Reform Scotland, said:

“The key problem with our pension structure is that those faithfully paying National Insurance and those paying into a public sector occupational pension scheme have no ownership over their pension assets. They are not paying into a personal pot for themselves – they are paying for today’s pensioners and are dependent on an increasingly stretched next generation to pay for them.

“Inherent in the system is huge insecurity for today’s employees and an immoral burden on the next generation. Politicians have been engaged in a conspiracy of silence on this issue and they must now begin to be more open about the situation in which we find ourselves. People deserve to know where their money is going and what their future prospects are.

“The current coalition government has merely moved the goalposts through its proposal to increase the pension age; its proposals are the equivalent of treating a compound fracture with a sticking plaster.

“It’s time to grasp the nettle on pensions and our report later this week will outline a solution to do just that.”