Public sector pensions strikes – what the Government isn’t telling you

This is what I was banging on about on facebook which prompted someone to ask why I didn’t have a blog yet. I’m just going to copy & paste it here ‘cos it’s quicker and we in the public sector like to be efficient.

The government is proposing 4 changes to public sector pension schemes
– increased contributions
– increased retiral age
– change to career average instead of final salary
– change from calculating pension increases based on Retail Price Index to Consumer Price Index

Right, we are all agreed that demographic changes mean changes are needed for the pension fund – but these have already been made. Changes were made to the pension fund a couple of years ago which have addressed the changes required as a result of a growing ageing population. So the government saying that changes are required on demographic grounds is nonsense. We’ve already addressed that. So part of the reason for the dispute and the strike is that the government are saying more changes are required on demographic grounds and they’re not.

Second thing – increased retirement age – fine if you’re fit and well in a sedentary job. Not that great if you’re a road-mender, or a physio, or a janny, or something else which requires a high level of strength, fitness and stamina. People in many public sector jobs are unlikely to be able to work until 68 because they just won’t be fit enough. I was talking to a man today who works in a residential unit for teenagers with challenging behaviour. He was expressing concern that the Government expects him to be able to do his job until he’s 67. He spent this morning being assaulted by a 15 stone, 6ft2″ teenager. He doubts he’ll be fit enough to deal with that at 57, let alone 67.

Change to career average salary from final salary – for some people this might work out better, but there are lots of ways to calculate a career average (remember doing mean, median and mode averages at school?) and they haven’t said which way they want to use. So this might be better for some people, but it might be much much worse, especially for women who are more likely to have years out for childcare because of the patriarchy and that. Should we accept a change when even the government don’t know how they want that change to be in reality? We could be signing up to something that sees us all much much worse off. Would you sign a mortgage agreement without knowing how much you’d have to pay every month or how long the mortgage term was? Would you sign a credit agreement for a new telly without being sure you’d actually get the telly?

Change from calculating annual pension increases based on RPI – CPI – already imposed without agreement, means pensioners are receiving much lower increases every year – pension increases have been reduced by about 15%. The UK is the 6th strongest economy in the world, but thousands of our pensioners die every year of cold-related illnesses. Making pensioners poorer will not keep them fit, well or alive.

Proposal for increased contributions – government wants us to contribute considerably more each towards our pensions, saying we’ll need this to cover demographic changes. Firstly, see above – already addressed – government are fibbing. Secondly, they’re fibbing. If this was about making us pay more to increase the pension funds, you’d expect to see the pension funds going up. But what the government want to do is make us pay more, then reduce the local government grant (which is the money central government gives to each local authority every year) by the amount of the increased contributions, so each employer will reduce their contributions to employees’ pensions. So we pay more, central government pays less, and overall the pension funds do not increase. So it won’t address demographic changes at all. It just means we pay more and the government has more in the Treasury to pay for illegal wars, MPs’ duck-houses, Nadine Dorries etc. So, fibbing. The Scottish Government have said that if the increased contributions bit was enforced, they would pay the increased contributions for local government employees in Scotland so our contributions would not go up – Westminster government has said if the Scottish government did that, they’d just make some legislative changes to impose it on us anyway.

Furthermore (I do like a good furthermore, don’t you?) there is no lack of money in local government pension schemes in Scotland. Lothian pension fund is so far in surplus that we could all stop paying in tomorrow and it could meet all of its commitments for the next 20 years. It appears to have been managed sensibly and well over the years and has a very healthy surplus. If these changes go through, people will stop joining, existing members will come out – several people have said to me that they can’t afford the increased contributions and would leave the scheme. The scheme relies on being attractive to members, being a good thing, so that people want to join – if it loses members it loses money and then it will have problems meeting its commitments. And if people only have the state pension to fall back on, as legislation stands just now, they’re likely to be entitled to top-up benefits, and some of those benefits entitle them to other benefits. So they’re costing the state money anyway. Where’s the logic?

I don’t think these changes are anything to do with affordability. They’re about a government that hates the public sector, thinks we’re a waste of space, hates the fact we’ve managed to retain reasonable terms and conditions when private sector employees haven’t fought for their rights, and wants to see us worse off. They want to take our pension money and spend it on whatever nonsense they want to spend it on – massive pensions for MPs being one of the things they’re happy to keep paying for, even if they’re voted out after one term.

I think it’s a crying shame that private sector workers have had their terms and conditions cut over the years. But cutting ours won’t bring theirs back. Decent pensions are affordable for all – support us in our fight, and then start fighting for your own.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s