Talks on public sector pensions avert planned strike

Trade unions representing public sector workers called off a 24-hour strike due to be held on 23 March 2005 over planned changes to pension arrangements after the government agreed to new talks involving ministers, employers and unions.

On 18 March 2005, the government responded to growing pressure from trade unions representing public sector workers concerning its proposed changes to public sector pension schemes by agreeing to new talks involving ministers, employers and unions. A number of public sector unions had secured membership support for a concerted 24-hour strike over the proposed pensions changes, due to be held on 23 March (UK0502102N), but called off the stoppage after the government’s announcement.

The government has proposed changes to a range of public sector pension schemes. Although the changes sought vary between the different public services, a common strand is to increase the normal pension age, usually to 65 in schemes which offer pensions at earlier ages. The changes also include moves away from final-salary-based pensions and reduced benefits.

A statement issued by the government said: 'It is the government’s belief that all those who keep our vital public services going deserve safe and secure pensions. With an issue of such importance to so many people, it helps no one that there have been misunderstandings and suspicions of these reforms. We have listened to concerns and recognise the need to get this right for the long-term. Rather than rush and risk getting the policy wrong, we want to ensure we get it right and carry the people affected with us. What we all want is an affordable long-term settlement which is fair to current and future generations.'

In the case of local government, the government is to establish a tripartite committee, chaired by the deputy prime minister, John Prescott, to 'consider and negotiate the long-term future of the local government pension scheme . . . with nothing ruled in or ruled out'. New regulations due to take effect on 1 April 2005 would be revoked. On public sector pension reform more generally, the work and pension secretary, Alan Johnson, announced that he had 'agreed to establish the most appropriate high level procedures involving the relevant ministers from across government. I am very clear that in those talks all aspects of the government’s proposals will be open to discussion and negotiation.'

Responding to the government’s announcements, Brendan Barber, general secretary of the Trades Union Congress (TUC), said: 'These are both very positive developments, and follow intense behind-the-scenes discussions over recent weeks. The major complaint by all the public services unions has been that changes - particularly on pensions age - are being imposed rather than negotiated. The government has clearly set a common policy for the public sector, but unions have not been able to discuss the policy as a whole with ministers.'

On 21 March, following a meeting of the public sector unions concerned, the TUC issued a statement welcoming the government’s call for a 'fresh start' on public sector pensions and ministers’ offer to 'negotiate constructively'. It announced that the seven unions which had planned to take industrial action of 23 March had therefore called off the strikes.

Commenting on the developments concerning the local government pension scheme, Transport and General Workers’ Union deputy general secretary Jack Dromey said: 'One million workers need now no longer fear poorer pensions from 1 April. Next we will negotiate with government, national and local, a sensible long-term solution, ensuring security and dignity in retirement for the nation’s public servants.'

Business leaders and opposition politicians criticised the government’s move. The Confederation of British Industry accused ministers of 'backing down in the face of political pressure'. David Willetts, the Conservative Party’s spokesperson on work and pensions issues, said the government was 'trying to sweep difficult issues under the carpet' during the run-up to the general election expected in May.

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