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Risk in Pensions Strike

The Herald

United Kingdom

March 28, 2006

 

Editorial Comment

What do educational psychologists, refuse collectors, probation officers, lollipop men and women, occupational therapists, librarians, janitors and cooks have in common? Two things. First, they are angry about government plans to raise their retirement age. Secondly, they will go on strike today for 24 hours to defend the so-called rule of 85, which enables public-sector employees in the Local Government Pension Scheme (LGPS) to retire at 60 on full pension if their age and years of service add up to 85 or more. 

Those unions that balloted members on industrial action expect the strike, which could be followed by further stoppages, to bring local government services to a halt throughout Britain. In Scotland, some 200,000 public-sector staff might not go to work today. That might be good news for children, who will have an unexpected day off school, but, in every other way, the strike is bad news. Elderly people who depend on home helps will have to make do with emergency cover provided by a skeleton staff. Working parents whose children attend local authority nurseries will have to make other arrangements. Council-run ferries will be off for the day and other services will be disrupted by the closure of piers operated by council employees. Commuters who use public transport will be badly hit. Motorists who use toll bridges will face delays. The unions want this strike and, if necessary, future stoppages to force the government to back down on plans to withdraw the rule of 85 in October. 

For that to happen, unions and striking workers will need the public on their side. Winning hearts and minds is far from certain. Indeed, it looks like a gamble. If there is to be public antipathy towards, rather than solidarity with, the unions, it will not be because people think poorly-paid workers in the public services do not deserve a decent pension. They do. 

The unions say the rule of 85 is necessary because it takes account of low pay and a pension scheme inferior to others in the public sector. Abolishing it would enable workers to retire at 60 only if they accepted an inferior pension.

The problem for the unions, however, is that they are causing disruption and, potentially, hardship by fighting to defend terms that appear increasingly to belong in another world from those employed in the private sector. Many private-sector employees have seen their future pension pots lose value. Many companies have closed final salary schemes (still the norm in public services) to new members. In some cases, existing employees are losing out. They are being told they might have to work to 70 to afford to retire. To rub salt into the wound, council tax bills would probably have to rise to help meet the cost of an unreformed LGPS. All in all, it seems there is a propaganda mountain to climb for the unions.

That is not to absolve the government in this matter. It is right to address public-sector pensions. But ministers should perhaps have trained their sights first on employees in Whitehall, the NHS, firefighters, the police and teachers who have kept their full benefits (including retiral at 60) and whose pensions are paid from general taxation. The government backed off from a fight with them after the threat of industrial action. 

Consequently, a new retirement age of 65 applies only to new staff. Going after public-service workers with less industrial muscle appears weak and less than fair, especially as three in four in the LGPS are women and nearly two-thirds work part-time. That said, the consequence of strike action – potentially hitting the most vulnerable to defend the highly questionable – is not the way to win support and change minds.


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