Public-sector pensions are often in the news, and the most common figure that journalists leap on is the outstanding unfunded liability – now estimated to be £790bn at March 31, 2010 on the government’s official figures, but nearer to £1.28 trillion when based on market interest rates.

These numbers are enormous - larger than the national debt - but mean little to the ordinary taxpayer. Much more important for the new government, however, is the cost of new public-sector pension promises each year. This figure can be managed with pension reform, whereas the outstanding liability measures promises already made.