25 November 2005
The prospect of a strike by 2 million staff moved a step closer this week after unions and the Employers' Organisation failed to reach an agreement over the pension age for the local government pension scheme.
The pension age in the LGPS is already 65, but employers and the government want to scrap the so-called '85-year rule', which enables scheme members whose age plus length of service equals 85 to retire on full benefits before they are 65.
Heather Wakefield, head of local government for Unison, told Public Finance that the unions accept that the rule will eventually have to go.
But while the EO wants to end the rule from April 2006, the unions want to delay the change for six months to include discussions over the protection of existing scheme members in separate negotiations over reform of the system, due next year.
Terry Edwards, pensions officer for the EO, told PF that the question of the timing of the 85-year rule change was 'tactical'.
The EO is concerned that delaying the changes to the rule will give the unions extra bargaining power when they enter the fresh talks next spring.
'The employers are looking for certainty. The draft regulations that [John Prescott] will probably issue next month should have something in them about the removal of the 85-year rule,' Edwards said.
'The unions would prefer it not to be in those draft regulations. They're looking to wrap it all up in the [new] discussions next year.'
The EO and unions met with Prescott at the beginning of this week, but did not reach agreement on to how the rule will be phased out and how existing scheme members will be protected.
Prescott has now given them until the end of next week to reach a mutual agreement. If they fail, he will make the decision himself.
Wakefield warned that if the rule were scrapped without the same lifetime protection for existing scheme members that other public sector unions had recently been granted, 'it'll be curtains: we'll ballot for industrial action'.
Any industrial action is likely to involve up to 2 million local government, higher and further education and police workers, from six different trade unions.
'But we really don't want that,' Wakefield added, 'as then we'll be in a dispute which will make progress on reforming the scheme harder to achieve'.