Defend pensions against Labour renegade Hutton

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RMT General Secretary Bob Crow has called for joint action to defend pensions against the proposals of Labour renegade Lord Hutton.

Crow said: ‘It is a scandal that a former Labour minister is acting as nothing more than an enforcer for the ConDem’s in their attack on public sector pensions.

‘While the top bosses are piling up tax breaks that allow them to retire to their villas and yachts at fifty five it’s going to be work til you drop for nurses, teachers and transport workers, with a pittance at the end of it, if this government get their way.

‘In France, millions of people have taken to the streets and picket lines in defence of their pensions and we need the same kind of response here if we are to stop the government robbing us of our retirement.’

Unite, Britain’s biggest union, warned that reducing the quality of public sector pensions will only serve to increase inequality in society, hitting women the hardest.

It said: ‘Seventy per cent of staff working in the public sector are women, they already face pay freezes and cuts in benefits, any increase in pension contributions will put even greater pressure on personal finances.

‘Unite has evidence that low paid women are opting out of pension schemes as they cannot afford to make pension contributions in the short term. It is a problem that will get worse if employee contributions are increased.

‘Public sector workers have already agreed to accept changes in their contributions and benefits. Unite’s submission to the “Hutton Review” has made it clear that public sector pensions are affordable in their current form.’

Unite assistant general secretary, Gail Cartmail, said: ‘The evidence shows that decent occupational pensions reduce inequality in society.

‘A race to the bottom will be a betrayal of fairness and lead to the deterioration of pension provision for working people across the board.

‘Eroding the quality of public sector pensions will hit women the hardest. Many women may have no choice but to vote with their feet and opt out of pension schemes altogether or even leave the public sector.

‘Pressures like the pay freezes and cuts in benefits both imposed by this government will make it harder to make ends meet.

‘Short term necessity will trump long term security as the government’s short sighted austerity measures bite.’

She added: ‘The hysteria over public sector pensions has been whipped up by the coalition government, private sector employers and pension industry experts. They have not hesitated to manipulate the facts to make a case for attacking public servants.’

Unite noted: ‘Recent data from the ONS shows that occupational pensions have substantially reduced the proportion of elderly households living in poverty since the early 1990s.

‘But the data also highlights growing income inequality in retirement between the top 20 per cent of earners with incomes four times that of those in the bottom 20 per cent.’

Teachers’ union NASUWT general secretary Chris Keates said: ‘It will be totally unfair and unjust if the outcome of the Interim Report is that there are to be further punitive changes to teachers’ and other public service workers’ pensions.

‘When it suited the last Conservative government to use teachers’ pension contributions to bankroll their spending plans, it was never claimed that the scheme was a burden on taxpayers.

‘Now that those who have dedicated their lives to public service, paying their contributions year on year, are approaching the time to realise their modest pension, the coalition government seeks to change the rules, with no justification whatsoever.

‘The orchestrated campaign of myth and misinformation about public sector pensions has been frustrating and demoralising, just as the coalition government, and the other obsessive opponents of public services, intended.

‘The constant, scurrilous claims, designed to mislead the public into believing that public sector pensions are “gold-plated”, have caused deep anger and resentment.

‘The average public sector worker’s pension is £5,000. The average pension for teachers is just under £10,000. Hardly gold-plated.

‘The pensions of teachers and other public sector workers were subject to a stringent review by the Treasury in 2006.

‘The outcome was significant amendments to the schemes, including raising the retirement age, an increase in employee contributions and provision to share any increased costs between the employer and employees, with a cap placed on the employer’s contributions.

‘This was, in the Treasury’s words, “a good and fair balance between the interests of teachers and the interests of the tax payer, ensuring long term affordability and viability”.

‘If the Interim Report recommends further, more punitive changes, then teachers will be deeply aggrieved and they will have a right to be so.

‘Teachers and other public sector workers have a right to expect fair treatment. We look to John Hutton to deliver this and quash the fears that this Commission was rigged from the outset.’

The University and College Union (UCU) said that changes to pension schemes needed proper consultation with fund members if they were to have any legitimacy.

On the same day Hutton’s public-sector pension report was released, the union released a dossier on Anthony Hodges Consulting (AHC), ‘pension communicators’ who have been hired to deliver a consultation period for the Universities Superannuation Scheme (USS).

The union believes that all members of USS should get a say on the future of the scheme and should be balloted over changes it believes will reduce benefits for members, create a two-tier system and put the final salary scheme at risk.

The union’s dossier includes quotes and glowing tributes from companies who have worked with AHC to make changes to their own pension schemes and lists those that have either cancelled their final salary scheme or are looking to cut benefits.

One example is this from Geoff McKenzie, Head of Pensions for Vodafone Group Services Limited, who praises AHC for their role in helping to close down Vodafone’s final salary pension scheme:

‘We recently completed a major pension change project including closing our DB Scheme to future accrual, improving our DC Plan and introducing salary sacrifice. AHC provided innovative ideas and excellent communications materials in delivering these challenging changes to the satisfaction of both the company and Trustees.’

The union also raised questions about AHC’s approach to the consultation.

The UCU says it believes that simply asking all USS members for their opinion through a ballot is the simplest and fairest way to consult.

It said the following text from the AHC website about asking the ‘right questions’ could be interpreted as seeking creative ways to get the answers they wanted:

‘We find creative ways of getting the message across. It might be a game, a website or a video. Or even a combination. The answers aren’t always obvious. By asking the right questions, we’ll help you find them.

UCU General Secretary, Sally Hunt, said: ‘I have a great deal of respect for the people who work within USS and it is perfectly entitled to employ who it likes to help it with its communications but the real issue is the inadequacy of the process AHC are helping to manage. What staff want is a vote on the changes proposed to their fund not someone trying to ask them the “right” question and not gimmicks.

‘USS members may understandably be concerned by the companies AHC have helped in the past, as many of them have got rid of their final salary schemes.

‘They may also be concerned that they have received such glowing references for their work in closing schemes to the satisfaction of the company and trustees.

‘They may well share my concerns that this consultation process is going to lack any legitimacy – whatever questions are asked.’