Archive for November, 2011|Monthly archive page

November 30 Pensions Day of Action

In Uncategorized on November 28, 2011 at 2:01 am


More than twenty trade unions and their supporters are preparing for a day of mass action over public sector pensions. As many as 3 million workers could go on strike on November 30th in what promises be the biggest trade union mobilisation in a generation.

Members of 16 unions –AEP,  Aspect, ATL, FDA,  CPS, GMB, NAHT, NASUWT,NUT, PCS, Prospect, SCP, UCATT, UCU, UNISON and UNITE – have already voted “Yes” to strike action.

A further 6 unions –  BAOT, CSP, EIS,  MiP,    SoR,  and UCAC – have announced plans to ballot their members.

The POA, whose members are denied the right to take strike action, says it will take action anyway

Ballot results have been coming in with massive “yes” votes – Unison 82% for strike action, GMB 83.7%, Head Teachers Union NAHT 75.8%, Unite 75%, UCATT 83%, NASUWT 82%  on a 40%+ turnout.


The government wants to impose career average pensions on public sector workers to replace their final salary schemes. This would cut many workers’ pensions significantly—and the average public sector pension is already less than £5,000 a year.

It has now also proposed increasing the rate at which workers build up their pensions benefit—known as the accrual rate. But this doesn’t mean a better deal for workers. Danny Alexander has told MPs that the ‘offer’ includes accrual rates of 1/60 – exactly the same rate as already applies in the existing scheme for new entrants – so it’s no real improvement.

For older people who are presently on a worse accrual rate of 1/80 but who also get a lump-sum on retirement as well, the 1/60 ‘offer’ may turn out to be a worsening of their pension, not an improvement at all. Also, as the TUC points out, the government has overestimated career average earnings. That means they are also overestimating eventual pension payouts.

November 30 (contd)

In Uncategorized on November 27, 2011 at 12:16 pm


Workers will still have to pay more each month—and that comes on top of a pay freeze. They will still have to work longer before getting their pension. For some this means an extra 13 years in work.

And the switch from the RPI to CPI rate of recording inflation has already hit pensions.

The PCS union calculates its members will lose an average £16,400 over 20 years of retirement because of this change alone.

The government says workers who are within ten years of the retirement age on 1 April next year won’t be forced into career average schemes. Some have claimed this means around a million workers will retire on the same pension terms that they are on at present.

But this isn’t the case. Older workers will still have to pay more in monthly contributions. For many workers this will mean paying a full 50 percent more than they pay now. This extra money will not be used to shore up allegedly “ailing” public sector pension schemes. It will go straight to the government to help pay off the deficit. If you are over 50 or so you would still be allowed to take your pension without reduction at 60. However, this will only be a few years extra protection for workers already close to retirement.

Part time workers earning under £15,000 a year will still have to pay any more each month.

This is because the £15,000 figure refers to the full-time equivalent wage rather than what workers actually get in their pay packet. Suppose a woman earns £11,000 a year working half-time hours. The government would say her full-time equivalent wage is £22,000. So her pension contributions would rise. The PCS says this exemption for low-paid workers would only cover 4 percent of its members.

Danny Alexander has said that the ‘offer’ includes a higher ‘cost- ceiling’ – ie a greater overall budget for the scheme

However, their original cost-ceiling was set so low that they were actually hoping to cut the employers’ contribution towards pensions. This slight concession might only mean that the employers will still pay in their existing 14.1% of salary costs after all.. Teachers, for example, will have to pay around 10% – compared to 6.4% now. For many that’s a £150 a month pay cut! The Treasury has made no real concession – it’s still getting away with cutting the cost of public sector pensions while we pay more to get less.

Many private sector workers have poor pensions or no pension at all. If the government succeeds in cutting public sector pensions, private sector pensions will then come under further attack