Downloading PDF. Please wait... Issue 1935a

Pensions: The plan to steal £100 billion

This article is over 17 years, 5 months old
The government has launched one of the biggest assaults on workers' living standards for decades, says Geoff Brown, secretary of Manchester trades council
Issue 1935a

The government tells us we are living too long. What ought to be a cause for celebration has, it seems, become a problem because we are getting too much in pensions.

Chancellor Gordon Brown wants us to work longer. He knows from the statistics that this means we will die sooner. He knows too that most pensioners are poor.

But he also knows that pensions have been robbed in the past. So now he is proposing the biggest single attack on working class living standards since the 1930s.

He wants to replicate the theft that has already been carried out over women’s pensions. What is the difference between a woman of 55 and a woman of 49? The 49 year old woman will get £20,000 less.

She will have to work to 65 to get her basic state pension, not 60. That is five years at £79.60 a week she won’t get – over £20,000. How many women of 49 or under know this? Has Gordon Brown or anyone else told them?

And imagine the figures if they can make 5 million public sector workers do an extra five years.

Each person will lose five years of occupational pensions of, say, £4,000 a year. That’s £20,000. Multiply that by 5 million and you get an incredible £100 billion switched from workers to the state.

Pensions are basically deferred wages. But often cuts in pensions are treated differently to direct attacks on wages. New Labour wants to cut public sector pensions by around a third.

Ever since Tory prime minister Margaret Thatcher attacked the basic state pension 25 years ago, pensioners have been getting poorer. Today the basic state pension is just 16 percent of average earnings.

The only sensible way to organise pensions is through taxes. Every child understands that today’s pensioners are kept alive by today’s and yesterday’s workers.

And when they grow up they will support their parents’ generation.

And in turn they will be supported by their own children. Across Europe, this is the main way of organising pensions. The principle behind it is called “solidarity between the generations”. This too has been under attack.

Defending proper pension schemes has led to huge strike movements in the last ten years in much of Europe. Given the enormous scale of the attack by Brown, we need to follow the example of workers in Europe.

The day of action called by the TUC on Friday 18 February needs to be the beginning of a massive campaign.

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