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Reports and Briefing Notes

Public sector pensions schemes: policy objectives and options for the future

Previous research by the Pensions Policy Institute examined the impact of the reforms introduced between 2007 and 2008 to the main public sector pension schemes, on public sector employees, on the sustainability of public sector pension schemes and on the differences between pay and pensions between the public and private sectors. The research found that the Government’s reforms have reduced the value of the main public sector pension schemes to public sector workers. However, the value of all the main public sector schemes is still substantially higher than most of the defined contribution pension schemes that are now more commonly offered by private sector employers.

There have recently been a number of calls for further reform of public sector pensions from political parties, business organisations and think tanks among others.This report:

  • Considers if there is a need for further reform of the public sector pension schemes, and identify the policy objectives that any further reforms might aim to address. 
  • Identifies a set of possible further reforms for the public sector pension schemes
The future of the public sector pension schemes project has been funded by the Nuffield Foundation. The PPI is very grateful for their support. The views expressed in the research are however those of the authors and not necessarily those of the Foundation.


Chapter one describes the state of the current public sector pension scheme provision in the UK. It sets out what we mean by public sector pensions. It outlines the main public sector pension schemes and the reforms introduced from 2002 up to those which came into force in 2008.

Chapter two considers the possible policy objectives that any further reforms of the public sector pension schemes might aim to meet.

Chapter three considers a range of potential policy options for the future of public sector pension provision as suggested by key stakeholders. These are identified and then can be analysed against the objectives discussed in chapter two.

Executive Summary

Executive Summary

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