Redundancy fears for public sector workers

05/08/2009

Public sector employees are increasingly becoming concerned about losing their jobs and retiring, new research has revealed.

The survey by Hymans Robertson found that 63 per cent of people employed in the public sector will rely on their pensions when they retire but 92 per cent do not know how this has been invested.

In addition, the study discovered that one in ten people working in the public sector believe their private sector counterparts will be better off post-retirement.

Meanwhile, 31 per cent of public sector staff are concerned about redundancy.

Alison Murray, a partner at Hymans Robertson, said: "These findings reflect the simple fact that those in the public sector are not insulated from the effect of the current recession."

She added: "There is certainly an over-reliance in the public sector on pensions as the only source of retirement income. This is concerning given very low levels of average pensions in some cases."

Responding to the report, Kevin Still, director of EuroDebt, commented: "It is not just the public sector that is concerned about retirement, last month the Pension Protection Fund (PPF) calculated that all the UK's 7,400 defined benefit schemes had seen their collective deficit rise to over £200 billion by the end of May 2009.

"Given the uncertainty in financial markets and the state of the economy, there is good reason for consumer concerns with regard to their pension scheme finances. Recent reports suggest that many people working in the private sector will be looking to work beyond retirement age or take on part-time work when they start drawing their pension.

"I think in the private sector that the concept of a 'job for life' has long since disappeared and there is a more pragmatic approach to tackling employment uncertainty.

"Whether you are working in the private or public sector, there needs to be effective planning for a drop in disposable income, which is impacting the majority of the UK households despite interest rate cuts. If you are potentially going to be in financial difficulty then take advice."

Tags; Retirement Money Problems, Job loss,

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