Union threat on pension talks as retirement age to be raised to 66

UNION leaders have threatened to walk away from talks on pension reform in an angry backlash against Treasury Secretary Danny Alexander’s claims that public sector workers will have to work longer and pay more for less generous settlements when they retire.

The Minister was yesterday accused of undermining negotiations by setting out detailed plans for raising the retirement age in the sector from 60 to 66; moving from a final salary system to benefits based on career-average earnings; and raising contributions by an average of more than three per cent.

With hundreds of thousands of teachers and civil servants set to go on strike over the issue, Mr Alexander warned that it would be a “colossal mistake” to reject a deal that was the best they could hope for.

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In a speech to the Institute for Public Policy Research yesterday, he said it was “unjustifiable to ask the taxpayer to work longer and pay more so that public sector workers can retire earlier and receive more themselves”.

However, union chiefs responded angrily to Mr Alexander’s intervention, accusing him of trying to sabotage talks by announcing details of the Government’s position to the media.

The GMB threatened to pull out of the negotiations. Its national secretary for public services, Brian Strutton, said the Government appeared to have “already made its mind up on some of the matters we are negotiating on”.