By Tony Phillips
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The TUC is finally fighting back in defence of pensions, says Tony Phillips.
Issue 293

The TUC call for a day of action in defence of pensions on 18 February could be the beginning of a more general fight against New Labour’s recent attacks. The government has announced that some of the changes to the Local Government Pension Scheme will come into force as early as April this year. That has forced Unison, which represents 800,000 local government workers but whose leadership is one of the most pro-Labour, to promise action. Its consultative ballot was overwhelmingly in favour of national strike action on 21 March.

The contradiction between the union leaders’ anxiety not to rock the New Labour boat and their need to retain credibility with the rank and file by mobilising against the attacks has become acute. As we go to press the normally more conservative GMB is preparing to ballot, as is the civil servants’ PCS, the lecturers’ Natfhe, and Amicus, with 1.2 million members, is holding a ‘public sector summit’ on the issue. It will be up to grassroots activists to use the official calls to push for more action.

Unison activists across the country report great enthusiasm for strikes: 85 percent of members in Oxford City voted in favour in their union’s consultative ballot; workers in Sandwell, West Midlands, have voted unanimously for action at section meetings; workers at London’s University College Hospital demonstrated outside their hospital as news of the attacks on their pension scheme came through; a similar protest is planned at Newcastle General Hospital; four Unison branches in the north east are planning to demonstrate outside Labour’s spring conference in Gateshead on 11 February. NUT activists in London are to lobby their union executive for strike action. Rallies are being planned across the country.

As with everything else New Labour does, this is all about profit. Like big business, many local councils took ‘pension holidays’ when the stock market was booming and are now facing sharp increases in employer contributions. Chancellor Gordon Brown, the man often presented as the face of ‘Old Labour’, wants to cut back on what are in reality deferred wages to avoid the need for increased taxation on big business and the rich to balance the books. Attacks on public sector pension schemes will give private sector employers the excuse to further cut back on company pension schemes. All workers have an interest in uniting against New Labour’s pension policy.

This is the most serious attack on public sector workers since the 1930s. New Labour plans to raise the retirement age for workers across the public sector to 65. From next year civil servants and health workers are threatened with the end of their final salary schemes. More than 1 million local government workers also face an increase in the minimum retirement age to 55. The government has published a Green Paper which threatens to remove final salary schemes from more workers, introduce restrictions on retirement due to ill health, increase contributions and reduce pensionable pay from 2008. These attacks will cost 5 million public sector workers a minimum of £20,000 each.

The government claims that the projected increase in the ratio of pensioners to those of working age over the next 50 years means that existing pension provisions are no longer affordable. But according to official government statistics, the percentage of GDP spent on pensions will only increase from 5 percent today to 5.7 percent in 2050. Hardly a crisis. Given increases in worker productivity, a fully employed workforce could easily support the increased numbers of pensioners.

The government argues that ‘generous’ public sector pensions can no longer be justified when so many private companies are ending final salary schemes. This is utter hypocrisy. Between 1991 and 2001 the number of workers covered by such schemes fell from 5.6 to 3.8 million. New Labour has done nothing to stop its big business friends robbing those who produce their wealth. The government only moved belatedly to protect workers from some of the most blatant pension robbery under union pressure. The average pension paid out by the Local Government Pension Scheme is £3,800 a year – a far cry from the lavish pension payouts many company directors can look forward to. Most workers in Europe enjoy much better pension provisions.

‘The one thing that public sector workers used to be able to rely on was their pension, but the government has turned that promise into quicksand,’ says Unison leader Dave Prentis. Many workers take early retirement due to ill health or stress and under these proposals will do so on worse pensions; 73 percent of paramedics are forced to retire before they reach the age of 60.

Longevity is closely related to class. Top male managers can expect to live until they are 78, while unskilled male manual workers have a life expectancy of only 71. Dave Prentis told a recent rally that ‘life expectancy for the average female hospital cleaner aged 65 did not increase by one day between 1972 and 1999’. A study by University College found that hospital porters and lower grade admin workers were far more likely to suffer heart disease and mental problems than professionals. Many workers will not live to collect their pensions.

Activists need to pull together meetings of trade union activists in every locality to organise rallies, protests and walkouts on 18 February. They must try and use the TUC call for a day of action to mobilise the largest number of people possible to engage in action. Already there are signs that this is possible. Local Unison, FBU and NUT branches have organised a meeting in Lambeth, south London, to organise action. In Bolton, Unison and NUT branches have organised a lunchtime protest outside the town hall on the day.

New Labour is gambling that the loyalty of the trade union leaders and lack of workers’ confidence will allow them to get away with savaging our pensions. We have to exploit their weakness and lack of credibility over the war in Iraq to inspire workers that this is a fight we can win. Last year 7,500 Network Rail workers successfully defended their final salary scheme by threatening strike action. In December bosses at Birmingham Airport were forced to back down from a similar threat after strike votes. Workers across Europe have launched mass strikes in a largely successful defence of their pension rights in recent years. By following their example, we can both defend our pension rights and punch a giant hole in the New Labour project.


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