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Volume 982: debated on Wednesday 2 April 1980

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asked the Minister for the Civil Service whether he will review the indexing of civil servants' pensions to ensure that no retired civil servant would be enabled to have an income on retirement in excess of that when employed or paid to the person who took over his former employment.

The annual pension awarded to a civil servant on retirement cannot exceed half his pensionable pay. Indexing preserves but does not increase the real value of the pension. It would be unreasonable, particularly at a time of high inflation, to restrict the pension in money terms to a retirement salary which may have been earned many years previously. I know of no case in which a Civil Service pension exceeds the present pay for the post to which the pension relates: such a situation could come about only in the most exceptional circumstances.