FRS17 to reveal £100bn hole in NHS pensions
The controversial pension accounting rule FRS17, which has revealed massive deficits in UK company pension schemes, is set to do the same to the National Health Service.
Link: FRS17 special report
Now taxpayers are likely to have to cough up to cover the cost of pensions owed to 1.3 million civil servants at the NHS, estimated as being equivalent to the revenue from 5p on the basic rate of income tax.
And it could even be worse, according to Charles Cowling, worldwide partner at William M Mercer actuaries, the NHS pensions bill could be as high as £125bn.
He told The Times: ‘Before the accounting change the government was simply reporting the cash cost of paying benefits each year, not the cost of the benefits it is storing up for future generations to pay.’
FRS17 takes a snapshot of company pension schemes’ assets and liabilities.