Ministers defy unions over pensions

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DEFIANT Ministers have announced they will press ahead with raising pension contributions next year for teachers and civil servants despite no agreement with unions.

Up to two million public sector workers went on strike last month in protest at the controversial pension changes, and intensive talks have since been held to try to break the deadlocked row.

The Department for Education and the Cabinet Office yesterday confirmed changes from next year will go ahead, although further talks will be held about future arrangements.

Unions attacked the decision, saying increased contributions were being imposed without agreement.

Most teachers will contribute more under the changes which Ministers say are part of the Government’s long-term reforms to control the increased costs of people living longer and to “re-balance” the contributions paid by scheme members and taxpayers.

The changes, which will save £314 million from the teachers’ pension scheme next year, are part of the wider £2.8 billion savings from public sector pensions by 2014-15 which the Chancellor announced in last year’s Spending Review, which will see public sector workers pay an average contribution rise of 3.2 per cent.

The Public and Commercial Services (PCS) union said the increase was an “unfair and unnecessary tax” on public sector workers and it was committed to continuing to oppose the rise.

It claimed a civil servant on an average salary of £23,760 would lose almost £1,500 next year through the increase in contributions and the public sector pay freeze alone, a 6.2 per cent fall in their living standards.

The union said that the consultation was “deliberately narrow and restrictive”, being limited solely to how extra contributions would be applied.

“The Government has still failed to make a case for the need for any increases in contributions – or any of the other changes it is seeking to make – and it is uncontested that the current schemes will be both affordable and sustainable over the long term,” said a spokesman.

“Despite there being ongoing meetings with officials in the civil service, there have been no public sector-wide negotiations with ministers – which set the parameters for the scheme talks – since November 2.”

General secretary Mark Serwotka said: “We remain committed to the negotiations and will continue to attend all meetings, but Ministers only appear to be interested in imposing an unfair and entirely unnecessary tax on people working in the public sector.

“Every single penny raised from contributions would go to the Treasury to pay off the deficit. We remain fundamentally opposed to public servants being forced to pay more and work longer for less in retirement.”

However the Government said that the changes will protect low earners, with those earning less than £15,000 on a full-time equivalent basis per year seeing no increase, and those earning between £15,000 and £21,000 per year will see an increase of no more than 0.6 per cent in 2012-13, or 1.5 per cent by 2014-15.

Schools Minister Nick Gibb said: “Our changes for next year are about keeping pensions affordable for future generations of teachers – while protecting new and low income staff from the biggest contribution increases over the next few years.

“Looking at longer-term pension reforms, we’ve been clear that teachers will still have one of the very best pensions available.

“Reforms to public sector pensions are necessary.

“The overall cost of public sector pensions has risen by a third to £32bn in the last decade.”