CUTS to public service pension schemes have “gone too far,” unions warn today as a report finds that employees are paying “substantially more” towards them.

According to today’s National Audit Office (NAO) report, members of the four schemes covering the armed forces, Civil Service, teachers and the NHS, are paying an average of 8.5 per cent of their income towards their retirement. 

The average of £2,700 in contributions in 2019-20 is 33 per cent more in real terms than 10 years before, despite a 12 per cent real-terms fall in pay over the same decade.

National Education Union (NEU) joint general secretary Kevin Courtney said that the dramatic increase, which is the result of reforms in 2011 and 2015, showed that the government’s cuts to public service pension schemes have “gone too far.”

The report shows that average pensions across the four schemes have risen by 16 per cent in real terms over the past 20 years, to about £10,000.

But Mr Courtney pointed out that the average pension paid to teachers had fallen from £13,679 in 1999/2000 to £12,337 last year.

The average pension paid to men across the four schemes, at £14,100, is nearly double that of £7,750 paid to women, the report found.

Mr Courtney called on the government “to work on reducing the gender pensions gap.”

Total payments from the schemes have doubled in real terms over the last 20 years, to £33.5 billion, but the bulk of the increase — some £10.1 billion — is the result of a 69 per cent increase in the number of pensioners, to 2.8 million.

Mr Courtney said: “As the NAO makes clear, the vast majority of the increase in the amount paid is due to the increase in the number of public service pensioners, which is a known demographic consequence of the baby boomer generation reaching retirement.

“The correct way of looking at public service pension costs is as a percentage of GDP. Public service pensions are affordable now at around 2 per cent of GDP, but are due to fall to 1.5 per cent of GDP by 2064/65.

“There is no justification for further politically motivated attacks on public service pensions.”

Unite national officer Caren Evans said: “These corrosive attacks on the scheme must stop. Many employees are on relatively low pay and increased contributions impact adversely on take-home pay.

“The average civil servant doesn’t get a fantastic pension upon retirement, even though they are now paying more in.”

NAO head Gareth Davies said: “HM Treasury’s reforms will help to contain future increases in costs for taxpayers.”

However the office acknowledged that the government could do more to consider how pensions can help recruit and retain staff.