Tuesday, 26 August 2008

Defending public sector pensions

The Tories have made it crystal that if (when?) they get back in power they will have a crack at the pension schemes offered to public sector workers. As I've argued before I think this is fundamentally wrong-headed, and attacking the wrong problem (the real issue is increasingly poor provision in the private sector). But then I'm a bit old skool and think people ought to have decent pensions to retire on.

One thing is sure, the labour movement needs to prepare for an attack on public sector workers' pensions. I think it's really important that these arguments are framed in the right way to try and give us the best possible chance, so here are a few ideas.

1. We should describe an attack on public sector pensions as levelling down. This is exactly what it is - knackering good provision where it remains and bringing everyone down to a lower standard. If the impression is developed of an unnecessary and damaging intervention, talking in these terms might also appeal to people's bias in favour of the status quo.

2. Get figures together on typical pensions in payment. For example the typical LGPS pension in payment is about half the national average. Repeating these kinds of facts can challenge the myth propagated by the Right that these are gold-plated pensions.

3. We should stress any 'reforms' as removing valuable benefits. The message ought to be that something valuable is being taken away. People hate the idea that they are losing something they already have, so this could be an influential message. It will be tricky as presumably the Tories would close the current schemes to new members rather than attack current members' benefits.

As much as some on the Right seem to relish the opportunity to attack public sector pensions I think it could be a very costly battle if we take a bit of time to frame the arguments correctly in advance.


Unknown said...

PCS (Public and Commercial Services Union) keep data on the levels of pension in payment and have been running a campaign against cuts in pensions for some months (t may be years) now.

As a rep. in that union I do know from discussions with members, that the one thing that would bring even fairly senior civil servants out on strike is an attack on their pension. We (for I am one, obviously) view our pensions as deferred pay - we accept crap pay, and our pay is poor compared to similar jobs in the private sector - as the price of doing work we feel matters, and getting a decent pension in retirement.

Tom Powdrill said...

Hi lexin

I agree it's a very sensitive issue, which is why it may well become a major battle when the Tories have a pop.

The problem is if changes are only made in respect of new starters. Current members will prob be less inclined to take action if their own benefits are not affected.

Mark Still News said...

It's not just the Tories getting back in, but The New LP will screw you up to may be in a nicer way than the Tories-but the same result!

My industry was privatised in 1994 and our pension scheme was really healthy we contributed 5% of our earnings and had a huge surplus-but it was then fragmented into 100 schemes in the privatisation madness. Now we have a massive loss and are paying in nearly 12% of our earnings and still not enough to tackle the loss

My advise to you is watch out-they are after your pension funds! You must educate your work force not to budge an inch and be prepared to battle long and hard!

Mark Still News said...

If the new starters are excluded from a final salary scheme don't think it don't affect existing staff?

Many new starters may even opt opt of an inferior scheme, this would then leave an unhealthy fund-that would affect all members in the long term.

Any way you don't want a 2 tier pension system where old staff are on final salary and new on some crap scheme.If future members are sold short today, you have a big problem on your hands tomorrow and this could affect recruitment into the union causing resentment and bitterness. All the country private and public sector should really get together to fight this!!

Tom Powdrill said...

Hi Mark

you're not on about the railways pension fund by any chance are you?

I agree the two-tier aspect of closing schemes to new members is an issue that wil blow up later. but if you were in the Tories position it would be the smart thing to do, since current members will be less inclined to kick off and the workforce will be divided.

Mark Still News said...

Even under NLP, not just the Tories, a lot of you will end up in the private sector in the future and are going to have changes to your pensions, just like what happened to the Railway workers and their pension scheme.

Current members will probably be less inclined to take action if their own benefits are not affected.This is nonsense everyone's benefit will be affected and later on the current staff will be outnumbered by the New staff. Who would be a target for redundancies, (a) the new staff on inferior schemes or (b)the current staff on civil service pension?

All sorts of problems will arise in the future, which comes pretty quickly. A sell out of tomorrows members, to safeguard today's membership will more than likely destroy your scheme in the end and affect every one!

Unknown said...

As a worker in the private sector I find it extremely unfair that I have to contribute to public sector pensions when I don't even have a pension myself. I'll find it even less fair when I & others in the same boat have to work long past retirement age in order to be able to live, consequently I'll be paying for other peoples pensions when I should be retired myself.
PS private sector includes many types of business & unfortunately not all are as highly paid as some think.

Mark Still News said...

Hi daniel

I work in the private sector too, I know what you mean and how you feel. Many of us were in the Public sector and then not brilliant pay rates or pension schemes, but far better than the neo conservative policies of the Tory & New Labour governments, which forced us to accept inferior pension schemes under privatisation.

Instead of taking it out on public sector workers, who have a fairly good pension scheme, you should start fighting for improved pension schemes in your industry or even Nationalisation of it.

This is what the parliamentary parties want, to divide and rule the British workforce?

Actually all pensions should be subsidised by the state, as these Billionaire banks have been bailed out-So private pensions should be equal to public ones. Why not-they found the money for the rich banking parasites-didn't they-Can't we have it for our pensions?

Unknown said...

Hi Mark,
I don't think nationalising every ten a penny workshop, cornershop, taxi service & many other small supply industries would either be possible or even help, face it, if my boss had to suddenly supply a pension scheme that would actually give some worthwhile benefit on retirement he'd have to either bear the cost himself (no way) or pass the charge on to customers which in turn would result in the customer looking elsewhere.
The small business private sector in reality has been completely overlooked & there will be a problem in the future for whoever is in govt because millions of privately employed people do not have a worthwhile pension, resulting in a new generation of poverty stricken pensioners. Who probably contributed large sums of money to fund public sector pensions!

Mark Still News said...

Hi Daniel,
You said:
millions of privately employed people do not have a worthwhile pension, resulting in a new generation of poverty stricken pensioners. Who probably contributed large sums of money to fund public sector pensions!

Don't take it out on Public sector workers, its part of their terms & conditions. You should really take this out on the Capitalists and Neo Conservative government. As I've said before if we can afford to pay golden handshakes to failed bankers and 700k yearly pensions, the private pensions must surely be topped up and should not be seen as an astonishing proposal after all the money we paid out to the banks.If this money had gone into pensions it would have filled those black holes in the schemes.

Mark Still News said...

These small businesses should really put aside some of their cash in hand for a retirement fund. I pay 14% of my total pay into a pension scheme on top of tax and Nat Insurance.

There really needs to be a government scheme set up for small business on how to advise them to plan for retirement. Perhaps there should be government pension schemes set up for all private workers without access to pension schemes, or the alternative could be that the state pays out loads of social security and benefits to these people?