It was just after 8pm on Wednesday that Lord (Adair) Turner received a telephone call from the Tr... Turner inquiry sent spinni

Less than a week before he was due to publish the findings of his painstaking three-year inquiry into the pensions crisis, the spin doctor told Lord Turner that he was about to be overtaken by a political storm. Specifically, he was warned that a letter to him from Chancellor Gordon Brown, claiming that the report's key recommendations were "unaffordable and unsustainable", had been leaked to the press.

Lord Turner's proposals to raise the basic state pension from its pitiful level of £82.05 a week - less than a fifth of national average earnings - and to restore inflation proofing by linking it to earnings, rather than prices, were bad enough in the Chancellor's eyes. That would load billions on to the cost of an unfunded scheme - and could add another 13p in the pound to the basic rate of income tax by 2050.

But to suggest - as Lord Turner's report will do when it is formally published on Wednesday - that this could partly be paid for by raising the retirement age to 67 sounded to Mr Brown like political suicide.

The Chancellor has waited a long time to become Prime Minister and has no wish to go to the polls offering the voters the chance to "work till you drop". One in five men and one in eight women never reach the age of 67.

Mr Brown knows there is rising awareness of how public sector employees can still retire at 60 on pensions heavily subsidised by the taxpayer. Worse, the £5billion tax on pensions he imposed in his first Budget as "a reform of advanced corporation tax" is now widely recognised as the biggest stealth tax of all and a major contributor to company pension deficits and closures.

The Chancellor also knows there will be more stories like today's news from the Halifax that average council tax bills have risen by 62pc in real terms - nearly double the 34pc increase in the average pensioner's income - since this tax was introduced.

Index-linked final salary pensions for local authority workers comprise a major part of those tax hikes, fuelling a growing sense of "them and us" unfairness - particularly among people on fixed private sector pensions who must pay them. Mr Brown fears more tales in local and national newspapers of pensioners going to prison, rather than stump up for soaring council tax bills. No wonder he moved swiftly to rain on Lord Turner's parade this week.

In a steely letter, copied to the Prime Minister, the Chancellor reminded Lord Turner that his commitment to preserve the real value of pension credit expires in 2008. This means-tested benefit is currently worth £109.45 a week and about half of all pensioners are entitled to claim - although only half of them do so. But, as Lord Turner instantly realised, any reduction in the value of this credit could more than cancel out the benefit of increasing the state pensions for the poorest older people. It was a heavy blow for the lord to receive at his home in Kensington.

Friends say his language on Wednesday night was "uncharacteristic" but he was more philosophical yesterday. He told The Daily Telegraph: "I hope that everyone will calm down and be prepared to debate real facts on Wednesday, rather than speculation.

"This represents two-and-a-half years work, although I was appointed in December 2002, it was March 2003 before the secretariat and team of nine was in place.

"I really cannot comment on what has been said in recent days but our report will form the basis for a serious debate about very difficult choices facing this country.

Nor is the crunch point far away. The number of Britons aged 65 or more will accelerate in 2010 when "baby boomers"born shortly after the Second World War reach state pension age.

Meanwhile, as medical advances means more people live to retirement and draw their pensions for longer, falling birth rates mean there are fewer people of working age following up behind them.

This creates a bulge in the demographics - sometimes described as "the pig in the python" - and a crisis for unfunded state benefits. As Aneurin Bevan, one of the founders of the Welfare State, pointed out: "The great secret about the National Insurance fund is that there ain't no fund." NICs and income tax deducted from earnings this week are used to pay next week's state pensions.

The graph on this page, Pensioners as a percentage of the adult population, is sometimes described as the dependency ratio. As can be seen, for the past two decades the ratio has been fairly stable at 27pc, or about one pensioner for every four people of working age, defined by the Government Actuary's Department as those aged between 20 and 64.

Just about the time Mr Brown expects to lead the Labour Party into the next general election in 2010, this ratio will start to rise as those born in 1945 reach state pension age. By 2020, the GAD statistics suggest the ratio is likely to be 33pc and by 2050 it may hit 47pc - or one pensioner for every two workers.

Mike Warburton, senior tax partner at Grant Thornton, said: "Something has got to give. If either of the major political parties had been responsible in their long-term planning, the ratio of public expenditure to national output ought to have fallen during the 20 years to 2010.

"This would have made the rising burden of the elderly more manageable after 2010 when upward pressures on public spending and the need to raise taxes will be difficult to resist. What has actually happened in the past five years is that government spending has risen faster than national output."

Stewart Ritchie, chief actuary at Aegon, pointed out the potential for inter-generational conflict in future if taxpayers are left to pay for decisions shirked today. He said: "Anything the Government does today to change pensions in future will always be subject to the will of voters in future.

"More immediately, the Government will need the support of opposition parties if it is to propose to raise the retirement age. Otherwise, it will become an issue at the next general election. Candidates will say, "vote for him and you will have to work until 67 - or vote for me and retire at 65'." Christine Farnish, chief executive of the National Association of Pension Funds, believes we need something similar to the Bank of England monetary policy committee to decide long-term strategy, independent of the electoral cycle. Since the Treasury transferred power to set interest rates to the MPC, homebuyers' costs have plunged - partly because experts have taken decisions politicians used to shirk.

Pensions professionals say an impartial commission of experts could achieve something similar for an ageing population. They are aghast at the way Lord Turner has been treated this week. He is widely respected for his intellectual acumen and the integrity with which he has attempted to unpick this Gordian Knot.

Now they fear that what they regard as Lord Turner's political impartiality is seen in Westminster as political naivety. Steve Bee, pensions director of Scottish Life, spoke for many yesterday when he said: "The leaks and spinning this week demonstrate why - if there were ever any doubt - pensions should be taken out of politics."

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