Treasury forcing through pension changes, say unions

9 Mar 12
Ministers were today accused of imposing changes on public sector pensions after the Treasury said negotiations had concluded for all but the local government scheme.
By Richard Johnstone | 9 March 2012

Ministers were today accused of imposing changes on public sector pensions after the Treasury said negotiations had concluded for all but the local government scheme.

Chief Secretary to the Treasury Danny Alexander outlined the government’s headline deal on reforms last December, but detailed discussions continued until today.

Alexander said these had now ended for health, education and the civil service, and the changes would be introduced from 2015.

They provide ‘a fair deal for public service workers and an affordable deal for the taxpayer’, he said.

Alexander added that the majority of unions had agreed to take these Proposed Final Agreements to their executives as the outcome of negotiations.

However, the National Union of Teachers said it had not signed up to the proposals.

General secretary Christine Blower said that the government had ‘always intended to impose its own views and cut our pensions regardless of the case for not doing so’.

She added: ‘We are still willing to negotiate an agreement but we cannot accept our members being asked to pay so much more and work so much longer for their pensions and receive so much less in retirement.’

Fifteen health trade unions, representing more than 1 million health workers in England and Wales, said they were following their own procedures for consultation’ on the proposals.

These include Unison, which has confirmed that it will ballot its 450,000 members in health over the final proposal.

Head of health Christina McAnea said:‘It is critical that our members have the final say on these proposals and we will meet with our key health activists before moving to a ballot.

‘The new proposals maintain a defined benefit scheme with a move towards career average. In this harsh economic climate it was crucial to ensure that no health worker earning less than £26,000 a year should be hit with an increase in their pension payments this year.’

Of the civil service unions, the FDA, which represents senior staff, and Prospect both said they would put the deal to members.

However, the largest, the Public and Commercial Services union, said it would continue to plan for industrial action, , currently scheduled for March 28, over the changes.

PCS general secretary Mark Serwotka said: ‘We will continue to talk to other unions about planning further widespread co-ordinated industrial action and there is as much reason as ever for our members to vote in our consultation ballot to reject these spiteful cuts.’

Prospect deputy general secretary Dai Hudd said the final offer had made ‘significant progress’ on the outline agreement tabled by the government in December.

But he stressed: ‘This offer only covers the new pension scheme to be introduced in 2015 and not the higher pension contributions being imposed from this year, which we continue to protest direct to the Treasury and ministers.'

A ballot will be approved on March 16, which will then be put to all 34,000 members.

Dave Penman, deputy general secretary of the FDA, added: ‘Whilst not ruling out the possibility of further industrial action, the FDA, together with the majority of public sector unions, agreed to suspend industrial action to allow negotiations to continue.

‘Those negotiations have now concluded and the final offer provides a clear picture of the government’s proposals for pension reform over the longer term. The FDA will be studying the detail of the offer before balloting members and considering our response.’

Regarding local government pensions, the government, the Local Government Association and trades unions agreed the principles on December 20 last year.

The Treasury today said that detailed discussions are still ongoing. Public Finance understands that the unions and the LGA submitted proposals to the government on February 9, and are awaiting a response.

The changes in the Proposed Final Agreements include increasing the pension age to the state pension age and changing from a defined benefit scheme based on final salary to one tied to career average earnings, as the government had planned. There has also been clarification on death in service and other ancillary benefits, such as the treatment of members who leave active service but rejoin within five years. Trades unions will also be able to assess the impact of the changes on equality.


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