Between 2011 and 2012, many public sector pension schemes made changes to their employee contribution rates as a result of recommendations outlined in the 2011 report of the Independent Public Service Pensions Commission chaired by Lord Hutton of Furness.
In general, as seen in the chart, these changes have led to increased contribution rates. Many schemes have introduced, or were already using, tiered structures where the contribution rate is determined by the employee’s earnings band.
In 2011, 47% of employees were paying contribution rates in the ‘6 to under 7%’ band, with 11% paying ‘7% and over’. Employee contribution rates increased in 2012, with 21% paying contributions in the ‘6 to under 7%’ band and 37% paying ‘7% and over’.This extract is taken from the 2013 edition of Pension Trends Chapter 8: Pension Contributions
Source: Office for National Statistics
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