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Unfinished business


After a 97.1 per cent 'YES' vote by Unison members for the renegotiated local government pension scheme, a scheme which covers over 1 million members in local government, further and higher education, transport, police civilians and the Environment Agency, Unison regards the fight to defend the scheme as drawing to a close.

The ballot, reflecting a response of approximately 25 per cent from members, was fairly stunning in dealing with critics of the negotiations – the 4,862 (2.9 per cent) who bothered to vote No. But it does raise questions as to the more than 70 per cent who didn't bother to vote at all. Unison accounts for 80 per cent of the members involved in the scheme.

The improved scheme has seen off government attempts to disband the final salary scheme, has improved death benefits and has avoided a two-tier scheme for new entrants. Consultation on protections are still ongoing but are more than likely to continue until 2020. Unfortunately, as with all pension schemes, the downside to the improved benefits is that you have to die to receive them!

Though the negotiations have dragged on for over 18 months and seen one national strike day last April, all the protections and improvements that Unison and the other trade unions involved in the scheme sought have been delivered.

The unions are now campaigning for a greater trade union involvement and participation in the running of the pension scheme, with a view to ensuring ethical investment and better returns to scheme members. That also has to include a recruitment campaign to the scheme itself, as many young and lower-paid public sector workers do not automatically opt in.

The unaddressed issue is that the original attack on public sector final salary schemes started with the European Union directive on final salary schemes in May 2002. Legislation to undermine such schemes was passed almost without comment in the 2004 Finance Act. In 2010 the earliest possible retirement age will be 55.

And it's not just in the public sector. Workers at Westland helicopter plant in Yeovil went on strike on 9 August against company plans to close the final salary scheme and lower pension benefits, with three further one-day strikes planned for the end of August and September.

Meanwhile, the EU directive remains on the books and will return, and it is no accident that the Department for Work and Pensions in its March 2007 report called for lifting of the regulation of pension schemes.