BOLTON Council is making a payment of £803,00 to the local government pension scheme — as householders brace themselves for a council tax hike.

The cash, over and above employer contributions, has to be paid to ensure the council pension fund can meet its commitments.

Martyn Cox, former pensions adviser and councillor, has questioned whether the current public sector scheme, set up by the Government, is fair on taxpayers and raised concerns that public sector workers may not get the pension they had signed up for.

Town hall bosses say they are obliged, along with other local authorities, to meet the costs of the pension scheme, which is administered nationally Cllr Cox said: “At the budget meeting the council passed a budget providing for a 3.5 per cent increase in the council tax. Once you strip the costs imposed by services like fire and police the extra amount going to the council only represents 1.2 per cent of the increase or just over £1 million of extra revenue.

“The inference being that the council is investing extra money into the local economy and protecting existing services and yet within the overall budget the council is making another ‘one off’ payment of £800,000 into the Greater Manchester Pension Fund.”

Bolton Council, like other authorities, operates a final salary scheme.

Under the current system employees contribute between six and nine per cent of their salary and the employer puts in about 15 per cent. But extra money is needed above this to meet legal pension commitments.

Cllr Cox said: “A debate needs to be had about the viability of the scheme.”

Steve Arnfield, Bolton Council deputy chief executive, said: “The pension cost was factored in before the council tax was set.

“We legally have to pay it. This amount is part of our pension contribution which is not a one-off payment but has been budgeted for in previous years.”

Bernadette Gallagher, Unison branch secretary, said: “It is a council liability like any other which will help to guarantee an average annual local government pension for women workers of just £2,600.

“Ultimately, this figure is a relatively small proportion of the council’s overall projected £481,593,000 expenditure for the coming year.”