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Police and fire service pensions
25/03/2010
The Scottish Government and COSLA have reached agreement on the long-term arrangements for administering funding for police service and fire and rescue service pensions.
The new system means that police and fire boards will have greater clarity and certainty when planning for the future. Previously, police and fire board budgets had to cope with varying levels of pensions costs depending on the numbers of police and firefighters retiring during a particular year.
The arrangements mean that, from April 1 2010, the funding of pensions from the Scottish Government will be managed separately from other funding for police and fire services. This is part of the Scottish Government's commitment to modernise and reform the police service and fire and rescue services and give transparency about where money is spent.
Justice Secretary Kenny MacAskill said:
"The Scottish Government are committed to supporting our police and fire services to ensure they can make Scotland safer and stronger.
"This deal, with the agreement of COSLA, will ensure clarity about police and fire pensions. It will also mean that police and fire board budgets will no longer be affected by the fluctuations caused by varying levels of retirements.
"These reforms will provide greater certainty about the budget for police and fire boards and allow them to plan for their future needs with increased confidence."
The cost of police and fire pensions for 2010-11 has been estimated at £270 million. The new arrangements will not impact on any pension scheme members.
The new arrangement, under the partnership in place since the Concordat, has been agreed with the Association of Chief Police Officers in Scotland (ACPOS) and the Chief Fire Officers Association Scotland (CFOA(S)).
Until 2008-09, police and fire boards paid pension from their budgets. In response to additional pension pressures in 2009-10 caused by the high numbers of police officers and firefighters recruited in the 1970s becoming eligible for retirement, the Scottish Government agreed to provide an additional £20 million towards pension costs, with the local government family contributing the remaining £20 million. The Scottish Government and COSLA also agreed to review the way in which police and fire pensions were funded.
This funding is over and above the additional £32.8 million which the Scottish Government made available in 2008-09 and the £22.3 million which the Government has made available in 2009-10 to meet the additional costs of changes in the commutation rates for police and fire officers. It is also on top of the additional £37 million that the local government family made available in 2008-09 to meet pension pressures.