CRAIGAVON Borough Council has a pension deficit of more than £8m - the seventh highest of all councils in Northern Ireland.
However, the Council has a statutory duty to pay employees their final salary pension and this may come from Council funds - meaning the ratepayer may have to stump up the cash.
The current deficit represents £88 per head of the population.
The figures, accessed by the TaxPayers’ Alliance, have been described as a ‘ticking time bomb’.
The organisation has called for the Local Government Pension Scheme (LGPS) to be reformed urgently, warning that it is ‘much more generous than most private sector pensions’.
The pressure group said the assets of all 26 council pension funds are ‘dwarfed by their liabilities’ creating a deficit which taxpayers are ultimately liable for.
Craigavon’s multi-million pound deficit equates to £88 per head of the council’s population making it one of the highest in Northern Ireland.
Taxpayers’ Alliance director Matthew Sinclair said the combined shortfall was a ‘ticking time bomb’ that’s being left for future generations of taxpayers to deal with.
Stephen Murphy of the Northern Ireland Local Government Officers Superannuation Committee, which administers the Local Government Pension Scheme for Northern Ireland, explained that the average contribution to the fund by employees is 6.4 percent of their income while employers including Councils contribute around 18 percent toward the employee’s pension.
The NILGOSC, which administers the funds for around 204 organisations in Northern Ireland including the Fire Service, said the last time the fund was assessed was on March 31, 2010 and the fund was 82 percent funding, leaving a shortfall of 18 per cent.
He said ten years ago the fund was working off a 21 per cent surplus and said the pension fund works to a 20 year plan.
He did say the fund made an income of 10.4 percent but said the fund was not fully assessed except every three years and this would be looked at again in 2013.
Mr Murphy said local government used the final salary pension scheme and that any shortfall in the pension for members would be the statutory responsibility of the council and not the company administering the funds.
“We are not required to pay their pension. The pension is guaranteed by statute and not dependent on investment returns,” he said.
When asked about the current deficit and what impact this would have, Mr Murphy said: “The deficit is only a value taken as a snapshot at the time. We expect the funds to be back in surplus in the next 20 years.”.
These figures come on the heels of the Hutton Review of Pensions which recommend an end to final salary pensions in the public sector.
A spokesperson for Craigavon Council said: “Council and Council employees contribute to a pension fund which is managed by NILGOSC on behalf of all the Councils in NI including the NIHE, NI Fire and Rescue, Translink, some non teaching staff and staff of a wide range of other associated employers. Council does not manage this fund per se and therefore no comment can be made on the projected shortfall.”