Who wants to be a millionaire?

More than 17,000 public sector workers have retired with pension packages worth £1 million, a report claims. Meanwhile, private sector workers have seen as much as £225 billion wiped off the value of their pension funds.

The figures, from the Taxpayers' Alliance highlight the growing difference in retirement provision between public and private workers, a disparity that is moving up the political agenda.

Around 4 out of 5 private sector final salary schemes are closed to new members as companies consider them too expensive in an era of rising life expectancies. But around 5 million public sector workers still enjoy final salary pensions, many of them funded from general taxation.

Most public sector pensions are "unfunded," meaning there is no money set aside for future payments. Instead, the state will pay for future pensioners' retirements at the time, out of contributions and tax revenue.

The latest Government estimate of public sector pension liabilities is £650 billion, but independent analysts say the real figure will be much higher, perhaps as much as £1 trillion.

Using Freedom of Information Act requests, the Taxpayers Alliance calculated that there are at least 17,150 retired public sector employees in receipt of an annual pension of at least £33,000. According to the TPA analysis, a private sector worker who wants to ensure a similar retirement income today would need to build a pension fund worth £1 million.

The £1 million pensioners include 3,680 retired civil servants, 10,484 doctors and other NHS staff, and 1,979 teachers.

The total number of pension-holders may be higher, since some organisations - including the BBC and Parliament - refused to release their figures.

Thousands of public sector workers retire with £1 million pension pots (Daily Telegraph, 3 November 2008)