The current pensions crisis is prompting many older workers to cast envious glances at the teaching profession. As has been widely reported, many companies are ditching pension schemes based on final salaries for “money-purchase” plans that invariably provide lower retirement incomes.

But teachers and other local authority workers are still entitled to final-salary pensions. Many of them can consequently look forward to a more comfortable retirement than many higher-paid private-sector employees.

Headteachers’ pension prospects look particularly rosy, especially if they have the stamina to work on until the official retirement age. A primary head retiring on a salary of pound;42,000 after 38 years’ service can expect an annual pension of pound;19,950, plus a lump sum of nearly pound;60,000. Someone on the same income, with a money-purchase pension, would only be entitled to pound;14,750, even if they waived their right to a lump sum.

“High earners stand to lose most if they are not in a final-salary scheme,” explained David Hanratty, of Nelson Money Managers, which produced the comparative pensions calculations. “These workers face retirement incomes up to 50 per cent lower than those offered by final-salary plans because their employers contribute less to their pensions. Their pension also depends on what they put in, not on their length of service.”

But even a class teacher retiring on a salary of pound;28,000 after 38 years’ service can expect not only a bigger pension than someone in a money-purchase scheme but a lump sum of almost pound;40,000 (see box).

Final-salary schemes guarantee a certain retirement income based on age, salary and length of service. Money-purchase plans are riskier because they depend entirely on the performance of the stock market - which has dropped 25 per cent over the past two years - and annuity rates on retirement.

“If a scheme is changed to a money-purchase plan, members are immediately faced with three large unknowns,” said David White, of accountants RSM Robson Rhodes. “How much should they invest to ensure a reasonable pension? Where should they invest it? And what will the annuity rates be?”

A survey by the National Association of Pension Funds found that four public-sector employers closed their final-salary schemes to new members last month, among them Birmingham University. Several local authorities, including West Sussex and Hertfordshire, have warned that council tax may have to rise to meet the shortfall in pension funds. Union leaders have predicted dire consequences if teachers’ pensions were ever to change to a money-purchase scheme.

“The pension is one of the few things that make teaching attractive at present,” said Brian Clegg, assistant secretary at the National Association of Schoolmasters Union of Women Teachers. “If you really want to annoy teachers, the best thing to do is to tinker with their pensions, as Margaret Thatcher discovered when she tried to raise teachers’ pension contributions by half a per cent.”

According to Marion Bird, deputy head of pensions at the Association of Teachers and Lecturers, it would cost hundreds of thousands of pounds to match teachers’ benefits in a money-purchase scheme. Teachers’ pensions keep pace with inflation and offer substantial benefits for family members. If a teacher dies after retirement, the surviving spouse receives half the pension.

“Although we would like to see more generous family benefits in the teachers’ scheme, you do not have to pay extra for them, as you would in a money-purchase plan,” Miss Bird said.

Perhaps the only downside of the teachers’ scheme is the death-in-service grant. While a money-purchase plan generally would provide a grant of four times final salary, the teachers’ scheme offers only twice the final salary.