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Lord Hutton to chair independent pensions commission

Former Labour Government Work and Pensions Secretary, John Hutton has agreed to chair the Commission on Public Sector Pensions.

The Commission will be asked to produce an interim report for September 2010 which will set out possible short -term savings together with a final report for the 2011 Budget.

The issues the Commission will consider in reaching its conclusions include:

• The disparity between public service and private sector pensions as part of the overall reward packge

• The impact on labour market mobility between public and private sectors of that disparity and

• Pensions as a barrier to greater plurality of provision of public service

John Hutton did not stand at the general election and has recently joined the board at US energy company Hyperion Power Generation. He held the following ministerial posts in the previous government~

Minister for the Cabinet Office 2005, Chancellor of the Duchy of Lancaster 2005, Secretary of State for Work and Pensions 2005–2007, Secretary of State for Business, Enterprise and Regulatory Reform 2007–2008, Secretary of State for Defence 2008–2009

Speaking on the Andrew Marr show on BBC 1 on Sunday morning, Osborne said: “The public sector pension bill is unsustainable, and the Office for Budget Responsibility, this independent office which we’ve created, has shown this, and we do have to tackle it. But again I want to do this in a way which everyone feels that they’ve had a chance to contribute, that they’ve had their say, so we’re going to be establishing an independent pensions commission.

“(Hutton) is a man with real intelligence and knowledge in this area, I think he’s going to bring a cross-party perspective to what is a national problem, and means this is not going to be done on a partisan basis.”

John Hutton
Chair of the Commission on public sector pensions

Remit
To conduct a fundamental structural review of public service pension provision and to make recommendations to the Chancellor and Chief Secretary on pension arrangements that are sustainable and affordable in the long term, fair to both the public service workforce and the taxpayer and consistent with the fiscal challenges ahead, while protecting accrued rights. In reaching its recommendations, the Commission is to have regard to:

~ the growing disparity between public service and private sector pension provision, in the context of the overall reward package – including the impact on labour market mobility between public and private sectors and pensions as a barrier to greater plurality of provision of public services;
~ the needs of public service employers in terms of recruitment and retention;
~ the need to ensure that future provision is fair across the workforce;
~ how risk should be shared between the taxpayer and employee;
~ which organisations should have access to public service schemes;
~ implementation and transitional arrangements for any recommendations; and
~ wider Government policy to encourage adequate saving for retirement and longer working lives.

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