I feel I must respond to George Self’s letter ‘pension Pots’ (Echo, July 30). The statement that a third of all council tax goes into council workers’ pensions is incorrect.

The cost to the council tax payer in Dorset is around six per cent of the council tax bill or £100 a year.

This is less than £2 per week – not the £550 per year which was stated by Mr Self.

A recent, independent Audit Commission report highlights that the average cost of the local government pension scheme for employers is between 15 and 20 per cent of pay, with employees paying between 5.5 and 7.5 per cent.

Unlike other public sector pensions, the LGPS is a ‘funded’ scheme with contributions from employees and employers invested to create a fund to meet future liabilities.

At the last valuation in 2007 the Dorset fund was 93 per cent funded.

The effects of the banking crisis and the recession and the fact that people are living longer after retirement will reduce funding levels to around 80 per cent.

Of course, the unfunded 20 per cent must be paid for but since most pensions are not payable for many years to come, this can be recovered over a period of time. As for the statement that many local government workers’ pensions are ‘gold plated’, evidence from the Audit Commission shows that 80 per cent of local government workers receive a pension of less than £7,000 per year – 50 per cent receiving a pension of less than £3,000 per year.

Cuts to the pensions of these people may not save tax payers any money in the long run as it may only result in transferring the burden in the form of additional state benefit payments.

Paul Kent, Chief Financial Officer, Dorset County Council and Dorset Pension Fund Administrator