As the government publishes plans to overhaul the civil service pension scheme, ministers have been warned they face "difficult and lengthy negotiations" over the proposals.

Under the plans, outlined on Thursday, final salary arrangements would be replaced with pensions based on a proportion of pay earned in each year of service.

The proposals, being released for consultation, would also raise the pension age for civil servants to 65.

If approved the changes will apply to new entrants from April 6, 2006 and staff currently in post from April 1, 2013.

Cabinet Office minister Ruth Kelly outlined "a range of proposals intended to modernise the civil service pension arrangements while reaffirming our commitment to the principle of a good quality defined benefit pension scheme with a substantial proportion of the cost being met by the employer".

"To ensure the financial sustainability of the civil service and other public service schemes, we propose to raise the pension age to 65," she added.

"We also want to reflect better the contribution made throughout an individual's career in the civil service, and propose to do this through basing pensions on earnings in each and every year of service.

"Fairness is the key theme running through the proposals. Fairness between civil servants and fairness in the relationship between those working in the public services and those, who, ultimately, fund them."

Union response

However the FDA, the union which represents senior civil servants, said the proposals would see a "huge fall in future pensions".

The union also warned that if successful it was "only a matter of time" before the government applied the same conditions to all other public sector workers.

FDA general secretary Jonathan Baume said: "The government wants our members to accept what is likely to be an inferior pension, and the proposals allow government a free hand to increase civil servants' contribution rates whenever they like.

"Those who lose most will be the most able, experienced, high-performing managers who are responsible for driving the government's modernisation agenda across the UK.

"They are also those most likely to be poached by the private sector who will always find ways to reward their best talent.

"Undermining these managers' pension expectations is no way to recruit or motivate these key government workers.

"Today we have only seen a bare outline of the government's proposals. We anticipate extremely difficult and lengthy negotiations ahead, and we will be acting closely with unions in the civil service and wider public sector over the coming weeks and months."