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Call emergency union meetings to rebuff pensions sell-out!

Submitted by martin on 19 December, 2011 - 11:00

Public sector union committees, branches, and workplace groups should call emergency meetings to reject the sell-out on pensions outlined at the TUC public sector group meeting on 19 December.

The Government has not shifted a millimetre on any of its three main plans for public sector pensions. [Click here for the Government's official announcement.]

  • a 3.2 percentage point increase in contributions by 2014/2015: the Government has already announced that the increased contributions will start for teachers and civil servants from April 2012;
  • pegging the pension age for public sector employees to the state pension age, which will increase to 67 by 2026 and then on to 70, faster than was planned when the talks on public sector pensions began;
  • switching the uprating of benefits from the RPI rate of inflation to CPI, which runs about 0.8% lower, reducing the value of a pension by 15% after 20 years. The Government has already introduced this shift, from April 2011.

The RPI-CPI switch gives a twist to the fourth main Government aim: switching all public sector workers to career-average from final-salary schemes.

A switch to career-average is not necessarily bad. But it all depends on the details of the inflation rate at which bygone years' wages are upgraded to calculate the average, and on the "accrual rate", the percentage of career-average acquired by each year's contribution.

The civil service union PCS points out: "Career average salary is calculated by taking a percentage of each annual salary and up-rating it by inflation. By cutting the inflation indicator from RPI to CPI, the government at a stroke reduced the value of... [career-average] scheme[s]". Only with a much better accrual rate can a career average scheme be as valuable as a final-salary one. There is no sign of that.

In short, public-sector workers will:

  • have more taken out of their pay in pension contributions - £100 a month more for even middle-range workers, on top of the continued cuts in real wages recently announced by the Government;
  • have to work longer for their pensions, often much longer: workers who can now retire at 60 may have to work until 67 as early as 2026;
  • get worse pensions.

What's new? On 19 December a number of union leaders, without consulting even their union executives, effectively, via the media, told the principal personages of the pensions drama, the rank and file workers and the Government, that the campaign was over. Why?

The details of the Government statements are below. Neither Unison nor any other union leadership endorsing the "heads of agreement" has given any detailed independent information to its members. The BBC summarised it like this:

  • 530,000 staff earning between £15,000 and £26,557 would be spared any rise in pension contributions next year. (But what about the following years? The Government's baseline of increasing contributions by 3.2% overall remains unchanged. This is just divide-and-rule juggling with who pays more than 3.2% and who pays less. Also, a backhanded concession of this sort was signalled well before 30 November.).
  • So would those less than 10 years away from retirement. (It looks as if the BBC has garbled this. No Government statement makes this promise. Probably the BBC has garbled the Government's 1 November concession that those fewer than 10 years from retirement would see their pensions unimpaired except by the RPI-CPI switch, though they would have to pay increased contributions).
  • Staff in areas transferred out of the public sector will retain their right to stay in the pension scheme. (That's good, but is a concession announced a while back, in the run-up to 30 November).
  • Improved accrual rates (the fractions of career-average pay you earn for each year's contributions). These are 1/54 for the NHS, 1/44 for the civil service, 1/57 for teachers. (But these improvements are not sufficiently better to "balance" the move from final salary to career average as the amount of which you "accrue" fractions, and the method of calculation of career average which ensures a low figure. The Government is explicit about that: "the accrual rate has been improved. This has been offset by lower revaluation of accruals...".)

Unison says that in local government there "will be no contribution increases for employees before 2014". There is not even a suggestion that the average contribution increase after 2014 will be less than the Government planned.

No union leader claims to have an actual agreement. Dave Prentis of Unison, and others, are calling off action on the alleged grounds that they have a basis for negotiations.

TUC secretary Brendan Barber said on 19 December:

"In health and local government... key principles for further negotiation in heads of agreement will provide the basis for further talks in the New Year... It's important to stress that no agreements have been reached, but unions now have proposals to put to their executives and members... The emphasis in most cases is in giving active consideration to the new proposals that have emerged rather than considering the prospect of further industrial action".

Unison talks of a "consultation" with members, but does not say "ballot". The union leaders may say that since they do not have a detailed deal, but only a "basis for talks", they can abandon the fight without even balloting the members, or, at least, without balloting them until the fairly distant time when they do have a detailed deal.

The headline media reports - that is, the story as received by the big majority of public sector workers - are that most unions have accepted the Government terms, quit the campaign, and settled down to negotiate fine detail.

A closer look at union statements [below] indicates that most unions have not quite accepted the Government terms. That means the sell-out can be stopped. It also means something else, though.

A firm stand by just a few combative unions - or even just PCS and NUT - could push the Government back even if every other union drops out. Those two unions alone have enough clout for that.

If a few unions take a firm stand, then they will probably rally others, such as the Unite health sector. If they only demur from full-scale capitulation, have their officials weaselling that they haven't really accepted the Government terms yet, and simultaneously but silently signal doubt about further action, then the weight of media and Government pressure will demobilise workers.

From that angle, even the stand of the PCS leaders is too weak. PCS declared that "the offer on the table in the civil service is not good enough and... the union believes further industrial action should be organised as early as possible in the new year if the government continues to refuse to negotiate on the core issues".

"Believes further action should be organised" is much weaker than "will organise further action", or even "proposes further action". And, rather than the action being necessary until the government concedes decent pensions, according to the PCS leaders it is necessary only until the government "negotiates on the core issues" (even if it negotiates without giving substantial ground?)

If this sell-out goes through, it will give a go-ahead signal to the Government to redouble attacks on pay and jobs which are going through with minimal resistance, and probably to supplement them with outright attacks on union organisation, of the type seen with the dispute at Langdon School in Newham and with the victimisation of Northampton NUT secretary Pat Markey.

Those attacks can only be fended off with the sort of ongoing, self-controlling campaign conducted by the NUT members at Langdon School, scaled up to national level.

The union leaders and the Government have chosen Christmas as the time for the sell-out, hoping that they can get it through without reaction from the rank and file, and that by the time union meetings assemble in January, the weight of media coverage will have made the end of the pensions campaign a fait accompli in the minds of union members.

Public sector union committees, branches, and workplace groups should call emergency meetings now!

They should also call for an emergency conference of the rank and file across the public sector unions.

PCS Left Unity, the dominant faction in PCS, has called a meeting for 7 January (11:00-16:00 at Friends House, Euston Road, London), and invited activists from other public sector unions to come too. That is good; but we need to do more than just back this meeting.

Although the publicity for the meeting says that it will be about "organising, not just debating", it also worryingly suggests that it could be dominated by vague though militant-sounding speeches from the top table. Its headline, "Name Day For National Strike", suggests that it could be limited to boosting one further token one-day strike by PCS to burnish PCS's militant credentials, and that's all. The "organising, not debating" line could be used to stifle any discussion of broader plans for action.

Only a continuing, self-controlling, and multiform campaign will push the Government back. A determined minority of unions could generate that campaign, and generate enough pressure inside the other unions to make their lay committees overrule their top officials' desire to capitulate. Time is crucial here. A wave of rejection across the union movement has to be set going now, without waiting until 7 January, and provide the impetus for real organising and real debate on 7 January.

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