Public sector employment numbers are reducing, not increasing, so the Ponzi scheme doesn't work (relies on ever increasing membership).
I would fully agree that the new funding model is still flawed, in the past I have advocated a move to a fully funded pension fund with a choice of pay in/pay out approaches:
- Defined contribution pension with fixed employer/employee contributions
- Defined benefit scheme based on career averages and regular revaluation and variable employee contributions (fixed employer contributions) to ensure the finance is there.
- Defined benefit scheme based on final salary with revaluation and variable employee contributions
That would prevent any re-occurrence of these problems and ensure fairness to both taxpayers and public sector employees.