"Taxpayer hit with £5.4bn pension bill"

From The London Lite:

The taxpayer's bill for town hall pensions soared by £400million to £5.4billion last year.

The cost of the local government pension scheme raised fears that town halls may be forced to raise council tax or sack teachers, social workers and other frontline staff to balance their books. Councils paid in an extra eight per cent to the scheme in 2008/09 compared with £5 billion in 2007/08...

Ministers are proposing top earners in local government pay contributions of 10 per cent of their salary. The Tories are planning a cap of £50,000 a year on public-sector pensions. A Communities Department spokesman said: "The Government is looking at ways of ensuring higher earners at councils make a more significant contribution towards their pension."

When I first read that, I had intended to do a pithy and punchy post pointing out there is a third option - cut the generosity of their pension schemes (or cut their salaries to compensate) but I realised that I actually know too much about this stuff...

First, who counts as a local government employee, and how many local government employees are there?

From directgov: "More than two million people are employed by local authorities. These include school teachers, social services, the police, firefighters and many other office and manual workers. Education is the largest locally provided service." The DCLG say "In England ... local authorities employed about 1.8 million full-time employees (FTE) staff"*

So let's call it two million in England. £5.4 billion divided by 2 million = £2,700 each, about ten per cent of salaries. Pensions guru Neil Record reckons that the true cost is closer to one-third of current salaries, so that's discrepancy number one. It's well and good Labour and the Tories wittering on about increasing contributions slightly to ten per cent, thirty per cent would be closer to the mark (which we gleefully adopted as a bench-mark into our UKIP Pensions manifesto, but that's another story).

Next, We all know that local councils spend far too much on righteous crap, so how many of those two million are actually "frontline staff"? The fag packet says that there are ten million school-age kids, so with a pupil-teacher ratio of 20:1, we'd expect there to be 500,000 teachers. According to this, there are 734,000 full-time equivalent teachers/teaching assistants in England (as against 505,000 in 1997, natch). "Social services" is a bit of a rag-bag (not quite benefits administrators, not quite teachers, not quite police/probation, not quite NHS, but I'm sure a lot of them are doing useful stuff) so let's go with the figure of 134,000 for England (in 2004) from here. There are 167,000 coppers in the UK (in 2006) from here, x 5/6 for England = 139,000. I can't track down number for firemen, but this says there are 18,200 'retained' (i.e. part-time firemen/people on call) so let's call it 10,000 full-timers, tops.

OK. I make that a grand total of just over a million. Let's stick on another half a million for admin staff, street sweepers, traffic wardens, planning departments etc, which gives us scope to cut up to half a million local government jobs. Starting with the Chief Executives on £200,000 of course, I'm not malicious.

Moving on, there are other state employees that we need, like armed forces (200,000), prison service (20,000) and state employees that do 'useful stuff' like nurses/doctors (500,000), porters, cleaners, cooks, immigration officers, coastguards, university lecturers etc. That might get us to two-and-a-half million or three million useful public sector workers (I'd prefer to fund NHS and education with vouchers, but I wouldn't expect the number of actual teachers, nurses or doctors to change that much).

So whatever number you factor in for admin, back-up staff, quangos, Whitehall etc, how the f*** do you end up with 8.2 million working in "Education, health and public admin" from Table 5.2 here, up by 184,000 over the last year? Sure that's the figure for the UK and not England, there are a hundred thousand people working in the private health and education sectors.

But this is where I run out of ideas and abandon all hope of being pithy or punchy. Is it just me who wonders about this, or am I mad and the rest of you know what the other five or six million are doing but aren't telling me? Is there a f***ing special department where all they do is invent new jobs? Have they forgotten where the off-switch is? Not that the Tories seem to have a clue either.

The TPA make valiant attempts to list all the non-jobs, but methinks that even they have missed the point. They arrive at an annual cost of £0.5 billion when it must be more like £100 or £200 billion. What we need is 'zero-based budgeting', which means basically sacking everybody and re-instating the couple of million that we really need, rather than trying to weed out the superfluous ones.

* Their summary of various facts and figures is pretty good, although it can't seem to make up its mind whether Council Tax makes up less than a fifth or a quarter of local government revenues.