Last week’s editorial and TES Magazine feature (October 2) both misunderstood the maths and overstated the need for “reform” of the Teachers’ Pension Scheme.
The Government, local authorities and all the teacher unions in England and Wales agreed on changes to the scheme in 2006. Properly costed by the Government Actuary’s Department, it was agreed by all that this would make the scheme sustainable for the longer term.
The normal pension age for new teachers has risen from 60 to 65 and contributions have increased for all teachers. Contrary to The TES articles, the agreement also includes provision for “cost-sharing”, very similar to that for the NHS scheme, with employer contributions capped at 14 per cent and future additional costs to be borne by employees.
The comparison you make between money paid in contributions and paid out as pensions in one year is not the same thing as an actuarial valuation of a scheme’s funding needs for the longer term. We await the next formal valuation report on teachers’ pensions, due early next year. We know, however, that the independent Pensions Policy Institute has projected that the cost of providing teachers’ pensions remains within the current contribution rates and that the recent valuation report on the Civil Service scheme indicated no need to increase contributions to finance the 2005 agreement for that scheme.
The real problem with UK pensions lies in the private sector, where many employers are using the recession as cover to slash pension provision. This will simply pass on the costs of supporting retired workers to future taxpayers through the benefits system.
Teachers are making a demonstrably fair contribution to our pensions. The average pension for a woman teacher retiring now is about #163;8,500 a year - hardly “gold-plated”.
We are not asking for something for nothing. We do, however, ask for a fair hearing, rather than more scare stories, as politicians seek to make pensions a political rather than an economic argument.
Andrew Morris, Secretary to the teachers panel for negotiations on the Teachers’ Pension Scheme.
