Teachers have chalked up £6.7bn in new pension benefits in the year to 31 March 2008, according to 2007/8 resource accounts for the Teachers' Pension Scheme (England and Wales).

These valuable pension benefits, which can be built up and taken from the age of 60 without any reduction, and the number of teachers accruing new benefits rose from 602,000 in March 2006 to 628,000 in March 2007.

"The Government estimates that pension benefits chalked up by teachers between April 2007 and March 2008 were worth almost £7bn," commented John Ball, head of defined benefit consulting at Watson Wyatt. "In other words, if it had paid teachers cash upfront rather than promising pensions to be paid in future, it would have handed over an average of £10,000 to each teacher."

Ball said that the discrepancy in the age at which teachers may collect their pensions, at age 60 rather than the State Pension age of 65 years old, adds around a quarter of its value to the pension. "But there is evidence that many teachers do not know they can get their full pension at 60. The taxpayer will not get value for money if public sector employees do not appreciate how much their pensions are worth. However, the Government may be too embarrassed by the discrepancy with the private sector to make much noise about this."

The public sector pensions debacle that rocked the industry back in December is also reported in the resource accounts, revealing the 20,300 former teachers were overpaid following the administrative errors. Former teachers received £26.7million in overpayments, which will not be recovered.

From January 2007, the Government began automatically enrolling part-time teachers into their employers' pension schemes unless they actively opt out. Previously, auto-enrolment had only applied to full-time teachers.

- Pensions Age January 2009

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