THOUSANDS of county council employees may be asked to increase their pension contributions because of a huge shortfall in their retirement schemes.

Kent County Council leaders have written to ministers asking if the Government would sanction changes to pension rules, which could mean individual pension contributions increasing.

In 2002, Kent's scheme had a deficit of £296million. This made it the local authority with the largest deficit in the country but most other councils are in a similar position.

Employee contributions may need to be increased, possibly from six to eight per cent. An alternative option would be to increase council tax bills still further to make up the shortfall – equally unpopular.

County council Conservative leader Sir Sandy Bruce-Lockhart said: “The issue with us and most local authorities is that the scheme was devised quite a long time ago. Now people start work later, retire at 60, then live for a long time. That’s splendid, but it puts different needs on the scheme than when it was set up.”

Most local authorities were already making contributions of between 16 and 21 per cent into their schemes to try and make up the shortfall but employee contributions were stuck at six per cent under current rules. “There needs to be a rebalancing of the burden,” stressed Sir Sandy.

The Kent Fund has 75 per cent of its assets invested in equities. In KCC's case, the value of these have dropped for the last three years.

In an annual report on the performance of the Kent scheme, Cllr James Scholes, the chairman of KCC's Superannuation Fund Committee, said the decline in the world stock market has placed "major question marks against the pension promises made by employers to scheme members."

Unison said it was dismayed to learn of the suggestion and expressed concern that it had not been consulted.

Branch secretary David Buss said: "This is news to us. At this stage, the case has not been made for increasing contributions. Part of the reason we have a pension scheme deficit is that we took pension holidays on the advice of actuaries who told KCC it need not make the full contribution in certain years."

Opposition Labour group leader Cllr Mike Eddy echoed: "The problems stem from the time the former Tory government allowed pension holidays. The choices are that it comes out of employees' wage packets or goes on council tax. If this money comes out of employees' pay packets, it will make it harder to recruit staff."