The Impact of the 2007-08 Changes to Public Service Pensions

2011-05-26
 | 
The Impact of the 2007-08 Changes to Public Service Pensions

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 0215559762

Category:

Page: 44

View: 676

Get eBOOK →
In 2007-08, new pension schemes were introduced for civil servants, NHS staff and teachers, designed to make public service pensions affordable. The changes are likely to reduce costs to taxpayers of the pension schemes by £67 billion over 50 years, with costs stabilising at around 1% of Gross Domestic Product (GDP) or 2% of public expenditure. The Committee is concerned that the Treasury did not test the potential impact of changes in some of the key assumptions underpinning the long-term cost projections. In addition, the Treasury has not tested whether reducing the value of pensions would affect the public sector's ability to recruit and retain high quality staff. Three-fifths of the savings to the taxpayer were expected to come from the cost sharing and capping mechanism - a transfer, from employers to employees, of extra costs that arise if pensioners live longer than previously expected. Employees would potentially pay 70% more for their pensions over the next 50 years if life expectancy continues to increase more than expected. Implementation remains on hold while the Government decides how to respond to the Independent Public Service Pensions Commission (the Hutton Commission). Public service employees do not have a clear understanding of the value of their pensions because they are not provided with clear and intelligible information to enable them to make rational decisions. Further changes to public service pensions are expected as Hutton's recommendations are implemented, but this should bring a period of stability and certainty for long-term public service pensions policy.

The impact of the 2007-8 changes to public service pensions

2010-12-08
 |  Business & Economics
The impact of the 2007-8 changes to public service pensions

Author: Great Britain: National Audit Office

Publisher: The Stationery Office

ISBN: 0102965587

Category: Business & Economics

Page: 48

View: 384

Get eBOOK →
Changes made in 2007-08 to the pension schemes of civil servants, NHS staff and teachers are on course to deliver significant savings and stabilise pension costs around their current levels as a proportion of GDP. Yet the value for money of the changes cannot be demonstrated, because the Treasury and employers did not agree the long term role of pensions in recruitment and retention of staff and the Treasury no longer has a financial objective against which to monitor the impact of the changes.And there is a risk that overall costs to taxpayers will be greater as a proportion of GDP, if growth in GDP is permanently less than expected. The 2007-08 changes affected schemes that account for nearly three-quarters of UK public service pay-as-you-go pension payments. There were immediate increases in employee contributions for NHS staff and teachers, following earlier increases for civil servants. The normal pension age was raised for new staff, from 60 years to 65 years in most cases. In addition, a new cost-sharing and capping measure was introduced to transfer, from employer to employees, the risk of extra costs from changes in factors such as pensioners living longer than previously expected. The NAO estimates that these changes will reduce costs to taxpayers in 2059-60 by 14 per cent compared to forecasts made without the changes. Aggregate savings over all years in the period to 2059-60 are equivalent to £67 billion in 2008-09 prices.

Public service pensions

2011-11-02
 |  Political Science
Public service pensions

Author: Great BritainH.M. Treasury

Publisher: The Stationery Office

ISBN: 0101821425

Category: Political Science

Page: 36

View: 318

Get eBOOK →
In this paper the Government sets out its preferred scheme design for public service pensions. It is built on the foundations laid by Lord Hutton in his report (Independent Public Service Pensions Commission: final report, 2011, ISBN 9780108510410). The cost of public service pensions paid out has risen by over a third over the last ten years to £32 billion a year. Reforms to date have been insufficient to reverse the increase in costs of public service schemes from rising longevity. The Government's offer is: benefits already earned are protected; for those in final salary schemes, those past benefits will be linked to their final salary when they leave the scheme or retire; public service workers with ten years or less to their current pension age, will see no change in when they can retire; Government will continue to pay more overall toward pension benefits than the workforce. The scheme design will ensure: guaranteed, index-linked pension benefits on retirement; an accrual rate of 1/60ths and earnings indexation for benefits while still working in the public service; fairer distribution of benefits across the workforce; and, that most low and middle earners working a full career will receive pension benefits at least as good as they get now. But in return, the Government is asking public service workers to pay more towards their pensions and work a bit longer. The Government's offer is conditional on the trades unions and the Government reaching agreement on the reforms.

Sessional Returns

2012-09-14
 |  Political Science
Sessional Returns

Author: Great Britain: Parliament: House of Commons

Publisher: The Stationery Office

ISBN: 0215048385

Category: Political Science

Page: 442

View: 838

Get eBOOK →
On cover and title page: House, committees of the whole House, general committees and select committees

Formula funding of local public services

2011-11-16
 |  Business & Economics
Formula funding of local public services

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 0215038681

Category: Business & Economics

Page: 48

View: 669

Get eBOOK →
This report examines existing approaches to formula funding across government, and the principles that should be carried forward to new arrangements. Government departments distributed £152 billion, one-fifth of all government spending, to local public bodies in 2011-12 based on the three grants considered: Primary Care Trust Allocations; Dedicated Schools Grant; and the Department for Communities and Local Government's Formula Grant. These distribute funding to local public bodies in a range of sectors, including health, education, local government, police and fire and rescue services. The formula funding systems are complex, difficult to understand, and have led to inequitable allocations. For Dedicated Schools Grant, based mainly on historical spending patterns, per pupil funding for schools with similar characteristics can vary by as much as 40%. Under Formula Grant, nearly 20% of authorities received allocations which are more than 10% different from calculated needs. The priorities accorded to different elements of the formulae are judgements which have a direct impact on the distribution of funds. In some cases the basis for the judgement is guided by authoritative, published independent advice. In other cases, the basis for judgement lacks transparency, and external advice lacks status and influence. Only 4% of respondents to DCLG's consultation supported the current version of the model used to calculate Formula Grant. Some of the data used by departments in calculating relative needs is inaccurate and out of date. Current reviews of formula funding provide opportunities to address the weaknesses identified in this report.

The Efficiency and Reform Group's role in improving public sector value for money

2011-10-11
 |  Business & Economics
The Efficiency and Reform Group's role in improving public sector value for money

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 021556166X

Category: Business & Economics

Page: 52

View: 508

Get eBOOK →
The Efficiency and Reform Group (the Group) was established within the Cabinet Office in May 2010 to lead efforts to cut government spending by £6 billion in 2010-11. Its long term aim is to improve value for money across government by strengthening the central coordination of measures to improve efficiency. The imperative to make savings in the short term has involved the Group imposing new controls on departments, such as moratoria on certain expenditure. Sustained efficiency improvements, though, will need a much deeper change to both the culture and institutional structure of government. The Group also needs to clear up confusion over who is accountable for what in terms of improving value for money, especially in defining its responsibilities and those of the Treasury and individual departments. The Group's actions have resulted in efficiency savings of £3.75 billion across departments in 2010-11. It should continue to describe any future spending reductions accurately and explain any impact on services. The scale of the challenge to deliver efficiencies is huge: the Government intends that half of the £81 billion reduction in spending planned over the next three years should come from efficiencies rather than through cuts to services or delays to important projects. Many of the efficiencies must be achieved in areas where the Group currently has a limited influence, or by local bodies, where it has none. The Group should set out how it will operate to ensure that its approach can be replicated across the wider public sector.

Department for Work and Pensions

2012-05-15
 |  Business & Economics
Department for Work and Pensions

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 0215045041

Category: Business & Economics

Page: 64

View: 459

Get eBOOK →
The Work Programme, designed to help long-term unemployed people into sustainable employment, started in June 2011, replacing virtually all welfare to work programmes run by the Department for Work and Pensions. Over the next five years, the Programme is expected to help up to 3.3 million people at a cost of £3-5 billion. 18 prime contractors, each with sub-contractors, are contracted to deliver the Programme across England, Scotland and Wales. The Department has done well to introduce the Work Programme in 12 months. Prime contractors receive the majority of their payments once a participant has stayed in a job for a set period of time, with the length of time varying according to claimant group. Although some financial risks have been transferred to the providers, the test of whether the Programme is achieving value for money will be whether more people are in work as a result of the Programme than would have been if it had not existed and that the wider social benefits which underpin the cost benefit analysis are delivered in practice. The Department should seek assurance on a range of issues: that sub contractors are treated fairly, not misled into accepting inappropriate contracts, and receive the number of cases and funding they were promised; that harder to help claimants are not parked and ignored; and ensuring proper value for money. The Department relies on contractors to set minimum standards of service but has no measurable indicators against which the quality of service can be judged

HC 1141 - The Work of the Committee of Public Accounts 2010-15

2015-03-28
 | 
HC 1141 - The Work of the Committee of Public Accounts 2010-15

Author: Great Britain. Parliament. House of Commons. Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 9780215085771

Category:

Page: 41

View: 380

Get eBOOK →
This report summarises the key areas of the Committee's work over the past five years. It draws out the areas where progress has been made and where their successors might wish to press in future. The Committee has assiduously followed the taxpayer's pound wherever it was spent. Since 2010 they held 276 evidence sessions and published 244 unanimous reports to hold government to account for its performance. 88% of their recommendations were accepted by departments. In many cases they successfully secured substantial changes, for example with the once secret tax avoidance industry. They secured consensus from government and from industry that private providers of public services do have a duty of care to the taxpayer, and in pushing the protection of whistleblowers further up the agenda of all government departments. By drawing attention to mistakes in the Department for Transport's procurement of the West Coast Mainline, more recent procurements for Crossrail, Thameslink and Intercity Express have all benefited from more expert advice and a more appropriate level of challenge from senior staff. After discovery in 2012-13 that 63% of calls to government call centres were to higher rate telephone numbers, the Government accepted our recommendation that telephone lines serving vulnerable and low income groups never be charged above the geographic rate and that 03 numbers should be available for all government telephone lines. They also secured a commitment to close large mental health hospitals.

Accountability for public money - progress report

2012-04-17
 |  Business & Economics
Accountability for public money - progress report

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 021504374X

Category: Business & Economics

Page: 82

View: 207

Get eBOOK →
This report is a follow-up to the Committee's report on Accountability for Public Money (HC 740, session 2010-11 (ISBN 9780215559029)) an issue at the core of the relationship between Parliament and government. Accounting Officers remain accountable to Parliament for funds voted to their departments but the policy intention is that local bodies will have significant discretion over the services they deliver. In the Government's response, 'Accountability: Adapting to Decentralisation', Sir Bob Kerslake drew a distinction between those services that government delivers directly and those that it may fund but are delivered in more decentralised arrangements. He proposed that Accounting Officers set out, in Accountability System Statements, the arrangements they have in place to provide assurance about the probity and value for money of funds spent through devolved systems. All departments are expected to produce Statements by summer 2012. Departments have made a genuine effort to develop arrangements which reconcile accountability and localism but the Statements so far are unwieldy and considerably more needs to be done to improve their clarity, consistency and completeness. There is concern that accountability frameworks must drive value for money and, critically, are sufficiently robust to address the operational or financial failure of service providers. Departments are placing increasing reliance on market mechanisms such as user choice to drive up performance and value for money, but there are limits to what these mechanisms can achieve. The Treasury needs to take ownership of the system and ensure that the Comptroller and Auditor General has the necessary powers and rights of access to examine the value for money of funds spent through devolved systems

Ministry of Defence

2012-05-25
 |  Business & Economics
Ministry of Defence

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 0215045254

Category: Business & Economics

Page: 48

View: 924

Get eBOOK →
The Ministry of Defence announced in the summer of 2010 that it had a funding gap of £38 billion over the next ten years. As part of the Government's efforts to reduce the deficit, the Department also needs to reduce its annual spending by 7.5% in real terms by 2015. It intends to achieve a significant proportion of its required savings by reducing its civilian personnel by 29,000 and its military personnel by 25,000, which it estimates will save £4.1 billion between 2011 and 2015. The Department is currently enacting a transformation programme to change its way of working in order to deliver on the Strategic Defence and Security Review priorities with fewer staff. However, the Department has put plans in place to implement reductions in its workforce before it has finalised its new operating model. The operating model will set out how the Department will meet its objectives in the future, but its reductions in workforce will be well advanced before the model is agreed. There is concern that plans to reduce the workforce have been determined more by the need to cut costs than by considering how to deliver its strategic objectives and that there is a risk of further skills gaps developing. This could make the Department increasingly reliant on external expertise with consultancy expenditure having already grown from £6 million in 2006-07 to £270 million in 2010-11.

Services for people with neurological conditions

2012-03-16
 |  Health & Fitness
Services for people with neurological conditions

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 021504293X

Category: Health & Fitness

Page: 48

View: 757

Get eBOOK →
Approximately two million people in the United Kingdom have a neurological condition, including Parkinson's disease, motor neurone disease or multiple sclerosis. But individual care is often poorly coordinated and the quality of services received depends on where you live. Some areas simply don't have enough expertise, both in hospitals and the community. In 2005, the Department for Health launched a new Framework to provide services for people with a neurological condition. There have been some improvements, such as a reduction in waiting times. But unlike the strategies for Cancer and Stroke, the model used to implement the Framework hasn't worked. For this clinical area, the Department left the implementation to local health commissioners but gave them no leadership at all and set no clear targets. It set no baselines and failed to monitor progress and so could not hold them to account where things went wrong. The present Government needs to understand what went wrong here for the future. Health spending on neurological conditions increased by nearly 40 per cent in three years. Over much the same period, emergency admissions have risen by 32 per cent and readmissions to hospital within 28 days have increased from 11.2 per cent to 14 per cent. The Department is moving towards a decentralised health and social care landscape. In doing so, it must set clear objectives for joint health and social care outcomes and services for people with neurological conditions

Transforming NHS ambulance services

2011-09-16
 |  Medical
Transforming NHS ambulance services

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

ISBN: 0215561325

Category: Medical

Page: 52

View: 821

Get eBOOK →
In 2009-10 the eleven regional ambulance services in England handled 7.9 million emergency calls and spent 1.5 billion pounds on urgent and emergency services. They are expected to make 4 percent efficiency savings year on year in a time when public demand for services continues to rise. Performance was measured against three response time targets until 1 April 2011, but the incentive to meet these targets has led to some inefficiency, such as when more than one team is sent to incidents. The Committee welcomes the decision to introduce a wider suite of health quality indicators to create a broader performance regime in which response times remain one indicator. There is wide variation in the cost of responding to an incident across the services, and there is a need for more consistent performance data in order to benchmark and share best practice. Under the NHS reforms there is vagueness around who will be responsible for what: who commissions ambulance services; who is responsible for improving efficiency in ambulance services or who will intervene if a service has financial trouble or seriously under performs? There is need for greater clarity on the roles and responsibilities of the Department, commissioners and ambulance trusts with appropriate structures for accountability. Other parts of the Health service affect ambulance services and a more integrated emergency care system is needed to ensure that ambulances are utilised in the most efficient manner. Levels of collaboration between ambulance, fire and police services could be strengthened.