Taxpayer boost to MP pensions gap

The announcement comes amid a council pension dispute

The Parliamentary pension fund is to get a boost from the taxpayer, the government actuary has decided.

Contributions to MPs' pensions from the public purse will go up from 24% to 26.8% from April to cover an increase in the fund's deficit.

The announcement comes as council staff plan fresh strikes in a dispute over proposed cuts to pension entitlements.

But the Cabinet Office said MPs would not have bigger pensions as a result of the rise, equal to £1.2m a year.

The government actuary reviews the fund every three years.

Longer lives

The level of taxpayer contributions to the Parliamentary fund is already well above the average of most schemes.

But in common with other private and public pensions, the MPs' scheme has been hit by lower-than-expected investment returns and its members living longer.

The fund's deficit has risen from £25.2m in 2002 to £49.5m.

The dispute with council workers is over plans to stop the cost of the huge local government pension fund ballooning by up to £6bn in the next 20 years.

Ministers' have said they are to press ahead with plans to scrap an option letting some council staff retire at 60 on a full pension as the rule discriminates against those who do not qualify.