27 January 2006
The European Commission has described as 'artificial' the government's rationale for removing the right of some local government workers to claim full pension benefits at 60.
The Local Government Pension Scheme's 85-year rule permits members whose age plus years in service reaches 85 to retire at 60, rather than 65. The government claims that the rule breaches a European Union directive on age discrimination because people with the same length of service could be treated differently depending on age.
But the commission's official spokeswoman on employment, social affairs and equal opportunities, Katharina von Schnurbein, said: 'It's an artificial debate [and one that] is only going on in Britain.
'The directive has no influence on pension value or age. It is completely up to the member state. If they think it is reasonable for people to retire at 60, under EU law, that is perfectly legal.'
Unions representing the 1.5 million workers affected by the government's plan agreed this week to ballot their members for strike action.
In December last year local government minister Phil Woolas said: 'It is our clear intention to remove the 85-year rule from the scheme from October 1, 2006 to comply with European age discrimination legislation.'
The precise timetable for removing the rule has been important in the year-long dispute. While unions tacitly accept that the rule might have to go, they want to delay negotiations until root and branch discussions over the shape of the entire scheme, scheduled for this summer.
Such a delay would allow unions to exchange the rule for better conditions for other scheme members – such as making it more affordable for low-paid staff, as well as lifetime protection for existing members.
Heather Wakefield, head of local government at Unison, told Public Finance she hoped the EC's comments – combined with the decision by Unison and the eight other affected unions to ballot their members to strike – would prompt the government to withdraw the draft regulations and begin fresh talks in the summer.
She admitted, however, that she suspected that the government's citation of the age directive was insincere. 'We've always thought that this is just a cover, because they've known about the directive for almost six years and it hasn't been mentioned before,' she said.
The current draft regulations propose protecting existing members who would qualify under the rule by 2013. Unions want similar lifetime protection measures to those secured last year for members of the civil service pension scheme.
PFjan2006
