Unions plan fightback as pension furore escalates

Hutton review expected to increase contributions from as early as April

8th October 2010, 1:00am

Classroom unions were this week planning a campaign against widely anticipated proposals to make teachers pay more into their pension pots.

An independent review of public sector pensions, by former Labour cabinet minister John Hutton, was yesterday expected to recommend that public sector workers will have to increase their contributions to fill a “pensions black hole”.

At the time of going to press, it was suggested that teachers could start having to pay a higher percentage of their earnings as soon as April next year. It was reported the rise could be as much as 2 per cent of their salary for higher-paid workers.

The expected move will anger teaching unions, which are already furious about a decision to use the consumer price index inflation rate to calculate pensions rather than the generally higher retail price index.

Classroom unions have calculated it could cost a retired teacher on a pound;10,000-a-year pension around pound;30,000 over the course of their retirement. Teachers are also expected to face a pay freeze from September 2012.

Chris Keates, general secretary of the NASUWT teaching union, warned earlier this year that teachers would be “very very angry” if a blow to pensions came on top of these measures.

Union leaders have widely suggested that an end to final salary pension schemes, in favour of a “career average” could tip them over into joint strike action.

This comes on top of expected cuts to education budgets which could lead to unrest if headteachers are forced to make redundancies.

Preparing for yesterday’s announcement, NASUWT general secretary Chris Keates said: ”“It will be totally unfair and unjust if the outcome of the interim report is that there are to be further punitive changes to teachers’ and other public service workers’ pensions.

“When it suited the last Conservative government to use teachers’ pension contributions to bank roll their spending plans, it was never claimed that the scheme was a burden on taxpayers,” she added.

Martin Freedman, head of pay at the Association of Teachers and Lecturers, said making public sector workers pay more was part of a government strategy to “appear fair”.

“Ministers want to be seen to be making cuts across society, not just in one area,” he said. “They want to put across the idea that we are `all in it together’. It’s nothing to do with the actual cost of pensions.”

Mr Hutton was commissioned to carry out the review by Chancellor George Osborne, who has warned the “unsustainable” rise in the annual bill for public sector schemes must be tackled.