TfL operates a final salary scheme into which all participating staff contribute 5 per cent of their pensionable salary, with the agency topping this up as necessary to fund the promised benefits.
Employer contributions currently total 31 per cent, including 4.45 per cent toward the scheme’s deficit, a level which is more than double the 13 per cent average contribution made by employers who come under the Local Government Pension Scheme (LGPS).
Conservatives on the London Assembly claim this amounts to an “overpayment” of more than £1.7billion since 2005 and say the money could have been used to fund projects including the Sutton Tramlink extension, the re-opening of Camberwell Station and extending the DLR’s Beckton branch to Thamesmead.
Assembly member Keith Prince said: “This is public money and it should be paying for improvements to London’s transport network, not bloating the massively over-inflated pension scheme for TfL staff. In its current form it is ripping off taxpayers.”
“If nothing changes there will be an even greater number of upgrades and extensions left on the shelf.”
Mr Prince obtained his figures via a series a written questions to Mayor Sadiq Khan who he’s called on to “address” the level of TfL contributions.
TfL points out that full details of its pension scheme are regularly published online and that the projects highlighted by the Tories are already in the Mayor’s draft transport strategy.
It says proposals to fund them will be brought forward as and when approval is given to proceed with each project.
A spokesperson said: “Arrangements for the TfL Pension Fund are very typical for this type of pension and, in addition to contributions from staff and TfL itself, the Fund also generates investment income from its wide range of assets.
“London’s transport system continues to be improved through billions of pounds of investment to run record numbers of trains, modernise stations and deliver the Elizabeth line, Crossrail 2 and the Northern line extension.
“Other major improvements will be taken forward in future years.
“At the same time, TfL fares have been frozen and our day-to-day operating costs cut by £153m.”
