§ Mr. David ShawTo ask the Chancellor of the Exchequer what reduction in(a) local government and (b) central Government costs would result from public sector employees being required to obtain contributory private pensions in respect of benefits above (i) twice the average weekly wage, (ii) thrice the average weekly wage and (iii) the earnings cap for tax relief operating for private sector pensions, if pension benefits were no longer paid for by the public sector above those levels.
§ Mr. DorrellIf the earnings on which public service pension scheme benefits are based were limited as described, the Government Actuary's Department estimates that the annual savings to central Government would be as follows:
Limit on earnings £ million Twice the average weekly wage 175 Thrice the average weekly wage 43 Earnings cap for tax relief introduced in the Finance Act 1989 11 These estimates assume that all future accruals of pension benefit would be subject to the limitations but that benefits accrued to date would not be so affected.
Data needed to prepare corresponding estimates of the savings for local government is not held centrally and could be obtained only at disproportionate cost.