Richard Lambert, the head of the CBI, is rightly concerned that the popular rage over MPs’ expenses is deflecting politicians’ attention from more pressing problems.
He cites a whole series of policy challenges that leave Britain in what he describes as a “burning platform moment”.
One of these issues is surely the growing burden of gold-plated public sector pensions.
In a new report for Policy Exchange, the centre-right think-tank, Neil Record has produced some alarming numbers. He estimates that the true cost of the taxpayers’ liability for the mass of public sector pensions that are unbacked by any investment and must simply be paid out of annual tax revenues or public borrowing has now reached £1,100 billion — more than three quarters of national income.
Servicing borrowing needed to meet the present cost of these final salary retirement schemes already costs £45.2 billion a year. And even on the Government’s own, lower figures, this bill is already bigger, for the first time, than the interest cost of the national debt.
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This is clearly unsustainable and at some stage somebody is going to have to get a grip of the problem, just as private sector companies have with their pension schemes.
To be fair, senior politicians on both sides privately concede that change must come and they insist that it will be tackled by the next government, be it Labour or Tory.
But the challenge is formidable and the politics a nightmare. So don’t hold your breath.