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Local government civils lose early retirement cash

GOVERNMENT PLANS to cut the pensions of local government engineers who retire early could make municipal engineering posts less attractive and increase pressure on senior officers, the ICE warned this week.

Under the plan, the minimum retirement age would be raised from 50 to 55. Those retiring before reaching 65 would have their pensions cut by up to a third.

An ageing population and falling stock market have left council pension funds across the country in the red after paying for early retirement packages.

Surrey County Council, for example, revealed last month that it faced a £600M shortfall.

As a result, the Office of the Deputy Prime Minister (ODPM) wants to change the law to discourage staff from retiring early.

Proposals are expected to go before Parliament this autumn and take effect from April 2005.

Chairman of the ICE municipals board, John Sanders, said pension arrangements were a major benefit for local government engineers.

He agreed that municipal engineer posts could become less attractive. But he said action was needed if councils were to avoid shedding jobs to maintain pension fund contributions.

But Sanders said the plan would worry senior local government engineers, who are increasingly associated with the policies of elected officials.

'With the advent of the cabinet system you have to work closely with the cabinet member and if there's a change of administration it makes officers more vulnerable than they used to be, ' he said.

'A lot of good people left because of these shifts and they have had pensions available for them to fall back on.

'Because the market for senior managers in engineering has reduced over time it's very difficult for people in their 50s to get another job at the same level.'

But the Employers' Organisation for Local Government backed the changes, pointing out that pension scheme members currently aged between 50 and 55 would be unaffected.

Workers reaching 60 by March 2013 are also protected, providing they have been in the scheme for 25 years.

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