Cabinet Secretary for Finance, Employment and Sustainable Growth

John Swinney MSP

T:0845 7741741
E: scottish.ministers@scotland.gsi.gov.uk

Kezia Dugdale MSP The Scottish Parliament Edinburgh EH991SP

Your ref: KS-11/08/11 Our ref: 2011/1014829 1... September 2011

Scottish Police Pensions Thank you for your letter of 11 August to the Cabinet Secretary for Justice, Kenny MacAskili MSP regarding Scottish police pensions. I am replying as I am responsible for public service pension schemes in Scotland, including the police schemes. It may help if I explain that the responsibility for occupational pensions policy is reserved to Westminster. Although Scottish Ministers have limited powers for some public sector pension schemes including the Police Scheme, these are subject to significant legislative and financial constraints by the UK Government. As such, there is no scope for Scottish Ministers to adopt different solutions from those being advanced by the UK Government-in respect of overall pensions policy, and often little scope to adopt different solutions in respect of specific public sector pension schemes. You will be aware that in June 2010 the UK Government commissioned Lord Hutton to conduct an independent review of public sector pensions, details of which can be found on HM Treasury's website: http://www.hm-treasury.gov.uk/indreviewjohnhuttonpensions.htm. The UK Government asked Lord Hutton to provide both short and long-term proposals for ensuring that public sector pensions provision remains fair and affordable. Lord Hutton issued an interim report on 7 October 2010 which concluded that public sector workers should pay more for their current pension benefits. The UK Government subsequently announced its intention to increase employee contributions to public sector pension schemes by an average of 3.2% of pay between April 2012 and April 2014 and, on 28 July 2011, the Home Office issued a letter confirming its intention to formally consult on proposals for changes to member contributions.

St Andrew's House, Regent Road. Edinburgh www.scotland.gov.uk

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The Scottish Government is clear that public service pensions must continue to be affordable, sustainable and fair. Scottish Ministers are, however, very concerned by the UK Government's proposals to increase employee contributions from April 2012, given the current pressure on household budgets. Our opposition to the UK Government's approach was outlined in my statement to Parliament on 22 June at the following link: http://www.scottish .parliament. uk/Apps2/Business/ORSearch/ReportVi ew. aspx?r=6314, which called on them to think again, recognising that policy responsibility for this issue is primarily reserved I am continuing to press the UK Government to respond favourably to the concerns raised by the Scottish Government. We will take decisions on this UK Government policy in due course and as part of that process will consult with pension scheme stakeholders. Regarding your constituent's comments on the Winsor Review, the Scottish Government reached a deal on the terms and conditions of Scottish officers for 2011/12, following constructive talks with the three police staff associations, Association of Chief Police Officers in Scotland and the Convention of Scottish Local Authorities. The agreements will save forces-around 8 million that can now be used to help protect frontline-police-services in Scotland. The recommendations from the Winsor Review part 1, for officers in England and Wales, have been commended to the Police Negotiating Board for the UK. The Scottish Government has always worked closely with the Scottish representatives of the Police Negotiating Board, and is committed to continue working in this way. No decisions on terms and conditions for Scottish officers will be made without discussion.

JOHN SWINNEY

St Andrew's House, Regent Road, Edinburgh www .scot land .gov .uk

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