Council tax funding pensions

Council taxpayers in the West Midlands are paying out millions to maintain the soaring bill for local authority workers' "gold-plated" pensions, a shocking report today reveals.

For every £5 raised in council tax, more than £1 now goes to fund the retirement of their staff, according to figures obtained by campaigning group the Taxpayers' Alliance. Birmingham, Britain's largest local authority, emerges the biggest spender on pension contributions.

It ploughed in £72.6 million in 2005-06, rising to £81.8 million in 2006-07, an increase of 12.7 per cent at a cost of £81 to everyone in the city.

Staffordshire ranks 21 in a table of the top 25 big contributors in England.

Its pension contribution went up from £33.1 million to £39.8 million during the same period – an increase of 20.4 per cent, at a burden of £48 to every member of the population.

Elsewhere, across the region, the cost to each person varies from £111 in Wolverhampton – to £74 in Walsall, £70 in Dudley, £89 in Sandwell, £18 in Cannock Chase, £13 in Lichfield, £9 in Stafford, £6 in South Staffordshire, £25 in Wyre Forest and £11 in Bridgnorth.

Nationwide, overall, spending on local government pensions rose by 13 per cent last year to £4.6 billion.

The scale of the burden emerges as families brace themselves for another inflation-busing council tax increase of 3.9 per cent – taking the average bill for a Band D home to £1,370.

Taxpayers' Alliance chairman Andrew Allum warned the most vulnerable in communities were being hurt by the over-generous provision for council staff.

He said: "It's unacceptable that ordinary families and pensioners who struggle to pay inflated council tax bills see so much of their money spent on gold-plated council pensions that have all but disappeared in the wider economy.

"The problem is clearly getting worse and requires urgent attention."

John Ransford, the deputy chief executive of the Local Government Association, which represents local authorities in England, insisted council workers deserved good pensions.

He said: "The TaxPayers' Alliance appears to be condemning lollipop ladies, binmen, street cleaners and librarians for getting a pension worthy of the years of service they have given helping local people.

"Councils provide more than 800 different services for local residents and these cannot be delivered by robots or machines," Mr Ransford added.