English pensions strife looks set to hit Scotland

1st July 2011 at 01:00
Chance of unrest grows as Finance Secretary says change needs Westminster backing

Scottish teachers are increasingly likely to follow their English counterparts in strike protest at pension changes after John Swinney, the Finance Secretary, last week ruled out the possibility of the Scottish Government going it alone on pensions reform.

Thousands of English teachers took strike action yesterday after talks between the TUC and the UK Government failed to reach agreement on two key issues: the proposed increase in contributions and plans to link retirement to the state pension age.

Teaching unions in Scotland had hoped the Scottish Government might defy the UK on pensions. While Westminster sets pensions policy for the UK, Holyrood has to pass the enacting regulations to change the Scottish teachers' pensions scheme.

Mr Swinney told the Scottish Parliament last week that it was "wrong to require employees to increase their pension contributions". But he added: "In terms of legislation, changes to the teachers' and NHS pension schemes require the active support of HM Treasury."

The Finance Secretary continued: "So without the UK Government's agreement, we cannot make changes to pensions rules for many of the key staff in Scotland who are delivering the services for which we are rightly held to account."

Drew Morrice, assistant secretary of the Educational Institute of Scotland, said that, in light of his union's AGM decision to ballot on industrial action over pensions, the prospect of Scottish teachers taking a similar stance to that of the NUT and ATL unions in England was much greater.

The increase in pension contribution had not been finalised, but a 3.2 per cent increase across the public sector, excluding the armed forces, was envisaged from next year up to 2015, said Mr Morrice.

In 2015, the UK Government wants to introduce further reforms following the Hutton report on pensions. And on top of that, a higher pension age of 66 will be introduced in 2020, rising to 68 in 2044.

"There is also talk about higher earners paying more, so that might lead to some adjustment across the schemes," said Mr Morrice.

Compared with other areas of the public sector, teachers as a whole might fall into the category of higher earners, while certain groups within education, such as heads, might have to pay even more, he warned.

The NUT was predicting that the average pension contribution would rise to 9.8 per cent from 6.4 per cent, he added.

Mr Morrice said that increasing teachers' pension contributions could have an impact on other taxpayers as teachers were more likely to opt out from their pensions schemes, leaving them more reliant on state support upon retirement.


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