‘DAVID Cameron and George Osborne’s political cowardice means they are presiding over an economic catastrophe’ said Unite leader Len McCluskey yesterday, commenting on the latest inflation figures.
The Consumer Prices Index (CPI) has risen from 4.5% to 5.2%, which equals the record high reached in September 2008, and the Retail Prices Index (RPI) rate of inflation has risen from 5.2% to 5.6% in September, which is the highest rate in 20 years.
McCluskey added: ‘Inflation is soaring, unemployment is out of control and there are no signs of growth. The coalition government is piling misery upon misery on ordinary families. Now more that ever Britain needs a plan B from this government.
‘Their refusal to change course is a political decision, not an economic one.’
Meanwhile, union Unison’s statement commented: ‘From today, millions of retired public sector workers will see the real value of their pension drop, because payments will be linked to increases in the September CPI, rather than increases in the September RPI.’
Based on the average pension rates in the health and local government schemes, Unison calculates that the move has taken more than £35 million out of the pockets of retired public sector workers in just one year alone.
September’s RPI figure has historically been used to calculate the yearly uplift in state and public sector pensions, as well as a range of other benefits, to reflect the cost of living.
With CPI consistently lower than RPI, this represents a cut in pensions and other benefits, at the same time as the government is trying to claim it wants to protect pensioners.
Dave Prentis, Unison general secretary, said: ‘This is nothing but a multi-million pound raid on pensioners to pay down the deficit. It’s a disgrace – retired people getting a state or public sector pension did not cause the economic crisis – but they are paying for it. At the same time the government is trying to claim it is protecting pensioners – these claims are hollow.
‘We already know that pensioners are struggling to cope with the rising cost of fuel, food and housing. From April next year, life will be a little harder for some of the most vulnerable in our society. It could push more people into poverty in their old age.’
The switch in pensions and benefits indexation is part of wider moves to attack pensions.
Unison says it is is currently running the biggest ballot in history over detrimental plans for public sector pensions, and is calling on members to vote ‘Yes’ for industrial action.
Government ministers are trying to raise £4 billion by making public sector workers pay more, work longer, all for less in their retirement – Unison believes this is a tax on public sector workers to pay down the deficit.
TUC General Secretary Brendan Barber commented: ‘The cost of living is now rising three times faster than wages – squeezing people’s living standards even tighter.
‘But instead of standing up for hard-pressed families, the government is making things worse by hiking VAT and cutting vital tax credits.
‘Ministers must do all they can to promote a plan B, based on jobs and decent wages. We cannot build a sustainable economic recovery on the backs of people getting poorer.’
Instead of whining on about a non-existent plan B the TUC leaders would be better employed resolving the crisis by acting to bring down the coalition and bring in a workers government.
