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Now taxpayers bail out MPs' pensions
A fresh row over MPs' pay and perks erupted after taxpayers were asked to foot an £800,000-a-year bill to bail out their gold-plated pension scheme
Under the plans unveiled by the Leader of the Commons, Harriet Harman, the Exchequer will increase its contribution from £12.4m to £13.2m a year. MPs will each have to pay an extra £60 a month to help fill a £51m black hole in the parliamentary pension fund.
The package was published after government financial experts found a growing deficit in the pension scheme because former MPs were living longer.
The Government Actuary said that taxpayer contributions to the scheme – already one of the most generous in the country – would have to increase by £2.1m a year to cover the shortfall.
Steve Webb, the Liberal Democrat pensions spokesman, branded the decision a "spectacular own goal for MPs". "The pensions of MPs and other well-paid public sector workers have to be brought in line with reality. With members of the public losing their jobs and seeing their pensions plummet, MPs cannot insulate themselves from the harsh realities of the recession."
Susie Squire, the campaign manager at the Taxpayers' Alliance, said: "Asking for more money to plug the deficit in politicians' gold-plated pensions is an utter disgrace. These pensions have been a bottomless pit for too long, and continuing to pump in taxpayers' money is no solution in the long term
"Why should taxpayers fund politicians retiring into the lap of luxury when they have seen their own pension reduced out of recognition? If MPs want such a generous pension, they must pay for it out of their own salary and not simply keep dipping into the pockets of hard-working people."
'A Huge Scandal'
Will Taxpayers Have to Bail Out EU Parliament Pension Fund?
The economic crisis has hit countless retirement funds, including that of members of the European parliament. They may take the controversial step this week to use taxpayers' money to top up the pension fund.
Despite denials from Brussels, EU taxpayers are to foot the bill for hefty and legally controversial pension supplements for many members of the European parliament. Their pension fund has run up a loss of €120 million ($156 million) as a result of risky share investments, according to an internal memo of the secretary-general of the European Parliament.