£70m 'hole' in pensions (From Free Press Series)

£70m 'hole' in pensions

THE Monmouthshire Council pension fund is facing a major funding black hole amounting to £70 million, it has been revealed.

The Greater Gwent Pension Fund, contributed to by five local authorities across Gwent, including Monmouthshire, is estimated to have £500 million deficit in total.

The massive shortfall is being blamed of years of a poorly performing stock exchange. Workers paying into the pension fund, who include council staff, police officers and college lecturers, will have their pension payments guaranteed.

But experts are warning that council taxpayers may have to foot at least some of the bill. Services could also be cut to make up the deficit, which could be reduced by a stock market recovery.

The pension fund shortfall came to light last week at a meeting of Monmouthshire Council's audit committee.

The committee was told that Monmouthshire's deficit alone was £70 million.

But Monmouthshire is not alone: Caerphilly's deficit is £137 million; Bleanau Gwent's £87 million; and Torfaen £90 million.

Monmouthshire AM David Davies says he is staggered at the figure. He is concerned local authority service and council taxpayers will be the worst hit.

He said: "This is a local authority pension and the money will have to be found in order to ensure that these pensions are paid. The taxpayer in Monmouthshire will have to come up with £70 million and that is a sum of £800 for every man, woman and child in Monmouthshire.

"Council taxes have already gone up extensively anyway and it is hard to see how they will cut services or raise taxes without it having a detrimental impact on the people of Monmouthshire."