Question to the Ministry of Housing, Communities and Local Government:

To ask the Secretary of State for Communities and Local Government, what assessment he has made of the potential liability to Government should the take-up rate in the proposed 2015 firefighters' pension scheme be lower than anticipated.

The Government is committed to providing good quality public service pension schemes and encouraging saving for retirement. Firefighters will continue to get one of the most generous public service pensions available – over £19,000 at age 60 after a full career (based on a firefighters’ salary of £29,000). Many firefighters who transfer to the firefighters’ pension scheme 2015 will see a reduction in their employee contribution rate of around 2 percentage points in 2015-16.

If a firefighter opts out of the pension scheme, this reduces the long term liability for the taxpayer but increases the short term top-up grant paid by the Department to fund the shortfall in scheme income. Overall, this would be likely to result in a long-term net saving for taxpayers, but we have not undertaken the actuarial work to calculate a precise assessment. This is because we would encourage firefighters to remain in the scheme, given it remains an extremely good defined benefit scheme – an equivalent private pension pot would need over half a million pounds of funding and require firefighters to contribute twice as much.