Strikes loom in wake of Hutton pensions review

11th March 2011 at 00:00
Union bosses warn of industrial action as final-salary schemes face axe

Teaching unions could move a step closer to industrial action this week, following the publication of a review which will trigger a major shake-up in public sector pensions.

Classroom and headteacher unions have already made angry noises about potential strike action following the outcome of Lord Hutton's review of public sector pensions.

At the time of going to press, general secretaries were already warning that the expected end to cherished final-salary schemes could lead them to strike.

An increase in the age that teachers can receive their pensions, coupled with a planned 50 per cent rise in contributions, would add fuel to the fire.

In his interim report, Lord Hutton stated that final-salary schemes are "inherently unfair", disproportionately rewarding high-flyers and stopping the flow of workers between the private and public sectors.

The final decision on changes to the teachers' pension scheme will be made by the Government, although ministers are unlikely to state their position until after the TUC march against public sector cuts on 26 March.

Unison, the union that represents 200,000 support staff, warned this week that plans to increase employee contributions could make pensions unaffordable for some of the lowest paid workers.

Unions are already furious about a two-year pay freeze imposed on all public sector workers. Monthly pension payouts to retired workers are also expected to shrink from 1 April, as they start to be calculated according to the Consumer Price Index inflation measure, rather than the generally higher Retail Price Index.

ATL general secretary Mary Bousted said raising contributions will result in a "significant drop" in the numbers of teachers joining the scheme, making it even less viable.

She said: "We are furious that the Government still has not provided a full actuarial valuation of the teachers' pension scheme, so that no one, including the Government, knows whether the scheme is affordable.

"This blatant disregard for the facts shows up the Government's pension plans for what they are - playing politics with ordinary people's futures because it is not strong enough to recoup the financial losses from the banks."

NUT general secretary Christine Blower added that the Government's plans for pensions were "based on politics, not economics".

PENSIONS AND PAY

MONEY SAVING MEASURES ALREADY CONFIRMED:

- By 201415 average teacher pension contributions will have risen from 6.4 per cent to between 9.5 and 9.8 per cent.

- April 2011: pension payouts for retirees to be calculated using the Consumer Price Index inflation measure, rather than the generally higher Retail Price Index. A teacher retiring on #163;20,000 could lose #163;70,000 over the course of retirement.

- September 2011: two-year pay freeze will kick in for teachers. Staff will still earn their annual increments.

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