was the question, "how would I solve it?"
ok, well I don't have the solution, otherwise i'd be paid £250,000 a year to implement it!!
but I think there are other ways of filling the hole. So for the sake of the argument if it's simplified like this:
The issue: There's a gap in what the country has and what it needs to pay out, so they need a solution to fill the gap.
their proposal: cut the public sectors salary and use that money to fill a gap. (i realise that's simplifying it, but essentially that's the proposal)
So, one of the reasons the pension fund is in jeopardy is due to dwindling stock markets. So it stands to reason that careful plans need to occur worldwide to bring public spending back to a good level and get the world out of the rescission it's in. Steer the country out of recession and as stocks increase the pension fund will start to recover. I think thats where the work should be focussed.
That's long term of course but some short term fixes; personally I think child benefit should be re-examined. Everyone gets child benefit, no matter what they earn. Personally our family earns a wage that is high enough that we could survive without it. I'm sure there is a large percentage of the country that could also live without it. So I would cap it at a certain household income of say £50,000.
I bet if all the families in this country earning over £50,000 stopped getting child benefit there would be a fir amount of money back in the pot.
In fact i'd look into lot of the benefit this country provides, I don't have a lot of sympathy for families that get benefit when they are capable of earning a living so I'd be keen to employ a better system of assessors to decide whether someone needs it or not.
I'd bring back more trade to the UK for products we currently ship in, I'd give tax benefits for large companies who agreed to keep business in this country, much like the tax cuts the film crew filming up in glasgow received compared to philly. More incentives to keep business here.
Just some of my thoughts. though!