Pensions: what's gone wrong?

Submitted by Matthew on 11 January, 2012 - 10:26

As Solidarity goes to press on 10 January, the public-sector pensions battle is in the balance.

Many unions have expressed dissent with the “final” Government proposals of 19 December. In fact, it seems that the only actual union signatures on a document are the signatures of Unison, GMB and Unite on a joint document with local government employers, and Unite has withdrawn that. Aside from that, even the union leaders keenest to put a lid on the issue are saying no more than that they will negotiate with the Government on its new terms and suspend action in the meantime.

Trouble is, that is enough for the Government. If the union troops are stood down, even with declarations that unions “reserve the right to take further action” such as the civil-service union Prospect has made, then the Government will impose increased pension contributions for teachers, health workers, and civil service workers from April 2012. Over the next months it will nail down measures consolidating the four things it wanted from the start:

* Pensions increased as prices rise only by the CPI index, on average 0.8% a year less than the RPI index by which they were previously raised, and thus reduced by 15% after 20 years. (This was enforced from April 2011).

* Increased pension contributions by workers.

* The age at which workers can claim full pensions raised to 66 by 2018-20, to 67 by 2026-28, and to 68 by 2044-46. (The Government’s plans on this have got worse, not better, since the union campaign started).

* Pensions changed from “final salary” to “career average”, with the method of calculating “average” and the accrual rate (fraction of career-average, or final-salary, won by each year’s contributions) set so that this means a big drop in pensions.

The chances for shifting that depend on the more defiant unions, like PCS and NUT, moving from general talk about possible further action to definite plans for action, and soon.

Even PCS and NUT have enough clout, on their own, to budge the Government somewhat. The battle is not over. It has suffered a setback sufficient to call for discussion on how we got here. What went wrong?

The union response was too late and too slow. The Government said that it planned to “reform” public sector pensions soon after the May 2010 general election.

It legislated the RPI-CPI change, cutting the value of pensions, in June 2010, and implemented it from April 2011.

It announced that it would take about 3% of workers’ wages in pension-contribution increases in October 2010.

It put forward its full package, more or less as it is now, in March 2011.

Unison leader Dave Prentis said that Tory pension-cut plans would be met by a “big national strike”, “militancy”, and “social dislocation”, back in April 2010, even before the general election.

Mark Serwotka, leader of the PCS civil service union, predicted in December 2010 that there would be “mass industrial action” by April 2011.

In fact, aside from two days of strikes by the lecturers’ union UCU in March 2011, the unions organised no action until 30 June 2011, and most of them not until 30 November 2011.

To call the union leaders’ campaign “snail’s pace” would be too generous. Snails at least keep moving. Both on 30 June and 30 November the strikes were organised with no clear plans for follow-up. Workers were called out on strike, then told to go back to work with no further perspective other than to wait and see if the union leaders might summon them to a further one-day strike some months later.

Between 30 June and 30 November the “campaign” amounted to little more than waiting to see when, or indeed whether, the union leaders would call the next one-day strike. There was little action even on the level of demonstrations or meetings or leaflettings. Proposals from Workers’ Liberty and other left-wingers for strike levies and rolling and selective action between the one-day “spectaculars” were rejected by many others on the left as well as by the union leaders.

That made the campaign also too narrow. The National Union of Teachers decided to run a campaign for “Fair Pensions for All”, linking the public-sector issues with the simultaneous and linked attacks on the state pension and private-sector pensions. But the campaign existed only on paper, and not much even there. No union made an effort to rouse the whole working-class public on the broad issue of pensions.

The campaign was too vague. The union leaders called on workers to strike “about” pensions (and PCS on its members to strike also “about” pay and jobs), but stated no clear demands.

Even the most militant of the main union leaders, Mark Serwotka of PCS, constantly stated the aim as “to get the Government to negotiate seriously”. Since everything the Government had put on the table was a worsening of the pension schemes, the demand for “a negotiated deal” meant that from the start the unions were demanding a worsening of pensions, only not quite such a bad one as the Government wished.

Then, month after month, the union leaders complained that the Government was not negotiating seriously, but did not tell their members what they, the union leaders, were saying in those negotiations. Did every session consist of the union leaders saying “we want to negotiate something not quite so bad, please”, the Government say “no, forget it”, and everyone going home after two minutes? Really?

Eventually, in December 2011, the local government unions told their members that they had signed a deal with the local government employers — but “could not” tell their members what the deal was, even after it had been signed, because government minister Eric Pickles had not yet approved it.

Union leaders complain that organisation is often weak, and so the unions could not attempt the more militant tactics which Workers’ Liberty and other left-wingers advocated. But the leaders’ method of running the campaign ran directly counter to revitalising organisation.

There was no self-controlled, rank-and-file action, only one-day “spectaculars”. On the days of action, union officials organised rallies rather than proper meetings where strikers could debate their action and propose their ideas about the next steps.

The unions were weak about even informing their members on the issues. Even now it is common to find union members, union activists even, who are vague about what an accrual rate is, or how the “funded” local government pension scheme differs from the others, or how CPI varies from RPI.

Evidently the union leaders’ assumption was such matters “go over the heads” of members, and are best left to the officials, though many of their members deal with more complex ideas, or teach them to teenagers, every day of the week.

Lack of union democracy and scope for rank-and-file has been the core weakness of the dispute. If that can be remedied, it will make the means to cure the other weaknesses.

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