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The assault on the Teachers Pension Scheme (TPS)

The current state of play

‘Pay more, get less, work longer’

UCU members will be aware that some 30 public sector unions are in dispute with the Government over attempts to ‘reform’ public sector pensions. The Government’s intention to attack our pensions was set out in the Hutton Report early this year, and has been reiterated more recently in the Autumn Spending Review, and in the Government’s Response on pension contributions on 16th December.

We (UCU Left) argue below that specific measures about particular issues (such as the structure of the TPS) must be seen within the context of the full package of measures intended by the Government to make us pay more, to work longer and to receive less in our pensions.

Having examined these various elements of detriment to the TPS, calculations by members of the London Retired Members UCU Branch suggest that the average total loss for every member after an average length of service of 15 years (assuming average salary of TPS members at £38,737) is £89,600.

Average total loss after a maximum length of contributory service of 40 years is £192,187.

The Government’s proposed changes are also intended to extract billions of pounds of our deferred wages to subsidise the current structural deficit.

The target saving across all the public sector schemes is £2.8 billion. £815 million is to be taken out of the TPS by 2014/15. These cuts are, of course, cumulative; they will persist beyond the life of the present Government.

Members will also be aware that despite the substantial differences between the USS and TPS schemes, and the different histories of the two disputes, the outcome of the TPS dispute will inevitably have an impact the potential outcome of the USS dispute.

 

How did we get here?

The UCU was the first union to declare a dispute with Government on the TPS issue, using the announcement of the change from RPI to CPI indexation as the trigger. We took strike action on 24th March, alongside our colleagues in pre-92 institutions, then again alongside the PCS and the other teaching unions when they joined us on June 30th. We were also part of the very successful and inspiring public sector general strike of 29 unions on November 30th.

Members’ anger and outrage at the attack on our pensions has been fuelled by a general awareness that the TPS is financially sound (like most other public sector pension schemes) having had paid in £700m more than it paid out between 2008 and 2010. The Government’s demands for savings are not based on any adverse valuation of the scheme. There has not, moreover, been a scheme valuation for several years. A periodic evaluation is due soon but the last one several years ago took account of demographic factors. Perhaps the Government is in such a hurry to cut our pensions because they know the valuation will show the basic health of public sector pension schemes.

Even if the scheme were not ‘healthy’, however, we should not accept any increases in costs or reductions in benefits because these are our deferred wages (or ‘salary sacrifices’) that we have set aside under the terms of a contract with Government. Our pensions are part of our remuneration packages.

 

Smoke and mirrors

The Government has sought to justify its attack on several other specious grounds. A claim has been made in regard to public sector pensions in general on demographic grounds, viz. that people are living longer, and therefore pensions are in payment longer; and that the population is ageing, and a smaller proportion of people in work will, therefore, have to pay a larger proportion of their salary for retirement. Thus, it is argued, people should have to work longer, and pay more in contributions.

These claims are undermined by figures from the Office for National Statistics which show that life expectancy in theUKis levelling out (82.4 for men, 85 for women). Rapid increases in average life expectancy in the last 50 or 60 years are very largely due to the decline in infant mortality, not people living much longer once they reach adulthood.

Nor is the proportion of pensioners projected to escalate rapidly: in the UKit was about 19% in 2009, and is projected to be about 21% by 2050. Clearly, in general people in developed countries, with one or two exceptions, are living longer compared to the 19th and early 20th centuries. This is something we should celebrate. It speaks volumes about any government that sees this as a problem that needs to be reversed. That is precisely what the attacks on our pensions and working life will achieve.

There is also a different, explicit, and quite specific claim that relates to the financial crisis of 2007/8, and the supposed need for the public sector to subsidise the resulting undercapitalization or risk exposure of the banks. The savings to be made from public sector pensions by various means are not to be paid as benefits, or to shore up any of the schemes, but are to be applied to the structural deficit. At least, that is the claim.

In practice they go to further bail out the banks. This means that the attack on our pensions is clearly a raid on public sector workers’ deferred wages. It is a class-wide assault, and is, therefore, part of an argument about who should pay for the financial crisis.


The 1% and the 99%

Yet while we face an austerity assault planned to last at least a decade, Goldmann Sachs and other major corporations have just been let off at least £25 billion of taxes that they owed. The 1% super-rich have multiplied their wealth but even the richest 10% are now, on average, £100,000 a year better off than in 2005. The majority of the rest of us have suffered falling incomes.

To add to the pressure and misery, rail price rises of 9% were announced just before Christmas, energy and fuel prices are increasing, and public sector pay rises are being pegged to well below inflation – yet more real terms pay cuts after the pay freeze of the past two years. How many more pensioners will die this winter from cold since 2.5 million of them already live in poverty?

We should resist any measures that will mean our members are more likely to live in poverty when we retire.



Government deadline

The week before Christmas, public sector unions involved in the four separate sets of scheme negotiations (local government, health, civil service and teaching) were presented with a deadline of Monday 19th December to sign up to broad agreements on revised pension scheme criteria, and further negotiating parameters. These were summarised in ‘Heads of Agreement’ or ‘Principles’ documents.

An agreement to call off industrial action

Different unions reacted differently to this deadline. Some (notably Unison, Unite and the GMB for the local government scheme) have signed the relevant Principles Agreement. Signing the document commits the unions to no further industrial action while further negotiations take place. This suggests that some union leaders have been prepared to give up the key to stopping this attack for an offer of very little.

Unite has not signed for its civil service members or for those in the health pension scheme. The local government unions suspended their agreement a day later after seeing a letter from Government minister, Eric Pickles, which misrepresented the agreement. This will be revisited at their meetings in early January.

Other unions, for example UCU, NUT, NAS/UWT and UCAC in the TPS, have not signed up to the TPS Heads of Agreement document, and have said that they want more detail and further clarification, although they have not said about what. The ATL and the NAHT have signed.

The main civil service union, the PCS, has rightly rejected the terms of the civil service agreement, saying that nothing significant has changed since before the strike action on 30th November. Other unions such as Prospect, NIPSA, FDA and the POA have also not signed.


Work longer, die earlier

As mentioned above, it is important to bear in mind that, whatever is dealt with in the Heads of Agreement document in respect of the proposed form of any revision of public sector pension schemes, the Government intends to push ahead with several related measures such as raising the state retirement age (SRA), and equating the normal occupational retirement age (NRA) of our pensions to the SRA.

Members born after 6th April 1960 but before 6th April 1961 will have to work until the age of 66 or 67 before retirement. In a worsening of the previous situation, members will recall that, in Osborne’s Autumn Statement, the Government announced that now people born after 6th April 1961 rather than 6th April 1969 will have to work until at least age 67.

In the TPS discussions, union negotiators failed in their attempts to keep SRA and NPA separate. This will mean not only that we have to work longer for less but that teaching will cease to have a common retirement age for the profession; instead, retirement age will be dependent on one’s date of birth.



RPI to CPI – up to 25% loss

Another significant element of the Government’s attack on public sector pensions and benefits is to change the annual indexation from the Retail Prices Index (usually 1.4 to 1.8% above the Consumer Prices Index) to the lower CPI.

This last measure, alone, will result in huge cuts to pension payments over an average retirement. Life expectancy at age 65, according to the ONS report, is 20.4 for women and 17.8 for men. Assuming a CPI/RPI difference of 1.5% over 20 years, the loss from the change in the inflator would be up to 25% of our pensions.

There has been no shift in the government’s position on this issue.

As a result of the proposed change from RPI to CPI, a lecturer on average salary retiring after the average service of 15 years would be £18,500 worse off, while one retiring after the maximum pensionable service of 40 years would be £54,650 worse off.



50% contribution increases by 2014

The Government also intends to raise employee contributions from the current 6.4% to 9.6% by 2014, beginning in April 2012. These increases will mean an average 50% increase in monthly contributions paid by scheme members for the rest of our working lives. Yet the gross cost ceiling is to remain at 21.7%. If average employee contributions are to rise by about 50% to 9.6% this means that employer contributions look set to fall from 14.1% to 12.1%. They pay less; we pay more!

There has been no significant shift in the Government’s position on this issue. By 2015, a top of the scale FE Lecturer on Point 8 of the national scales will be paying about £88 per month more. A top of the scale HE lecturer will pay about £104 per month more. These contribution increases are, effectively, pay cuts.

The increases need to be understood within the current context of falling real salaries in both FE and HE.

The Heads of Agreement document does not specify the increases that will be due beyond the financial year 2012/13, which it is suggested will raise only 40% of the target saving.

The Government’s Response to comments submitted on this issue, published on 16th December, sets out a graded contribution scheme such that the lower paid will pay smaller increases than the higher paid (included as Annex B to the Heads of Agreement document), at least for the next year.

The highest paid teachers and lecturers, who will be required to pay 2.0 – 2.4% from April, only comprise 0.7% of the 630,000 TPS members, however, and the proportion of lower paid teachers (below about £26,000pa), who will pay nothing or 0.6% this year, comprise only 17.3% of scheme members. The latter will, of course, still be hit by further contribution increases in the next two years, and will progressively move into higher contribution bands. For some younger lecturers this may be an active disincentive to remain in the scheme, thus adding to potential instability. They also face the prospect of working until 68, or even later.

The vast majority of scheme members, the 82% earning between £26,000 and £75,000 this year, will pay increases of 0.9% to 1.6% from April 2012.



Main points of the TPS ‘Heads of Agreement’ document

This document sets out the structure of a new proposed pension scheme for introduction from 2015. Here is the link: http://www.scribd.com/mobile/documents/76222270

The TPS website is here: www.teacherspensions.co.uk

There is a pension calculator under construction: http://www.teacherspensions.co.uk/bulletin/bulletin1.htm#a25_11_11



Shift to a CARE scheme from Final Salary

Apart from confirming the RPI to CPI change, the rise in employee contributions, and the intent to equalise the NPA and the SPA for lecturers and teachers in early and middle career, the proposals’ main aim is to set out the parameters for a shift from the current Final Salary scheme to one based on career average (CARE).

The Agreement states that the costs of the scheme, as summarized, are within the Government’s cost ceiling, and meet the Treasury’s risk criteria. In other words, it is we who will continue to pay for these cuts.

Key elements of this scheme will be an accrual rate of 1/57th (i.e. 1/57th of your salary is calculated annually for your pension). This is an improvement on the current 1/60th for those on Normal Retirement Age of 65 for the Final Salary scheme – but not much of an improvement. The civil service CARE scheme has an accrual rate of 1/43rd!

The revaluation rate of active members’ benefits is to be at CPI + 1.6%, (an improvement on basic CPI) but … what happens if there is a period of recessionary price falls? In November, the Government was proposing average earnings based on Hutton’s recommendation but has now substituted this new measure – which they calculate will still deliver savings for them.

Considered solely on narrow financial grounds it is possible to negotiate a CARE scheme that does not result in members losing money – it all depends on the accrual rate.

In considering the features of the current offer, as a result of the proposed change from Final Salary to Career Average (CARE), the London Retired Members Branch has calculated that a lecturer retiring after the average service of 15 years would be £22,000 worse off, while one retiring after the maximum pensionable service of 40 years would be £3,000 worse off.

In order to achieve an average pension of £11,759 based on the current average salary of £38,737 (based on TPS figures) after 15 years of service, the accrual factor would have to be 1/50 with the re-evaluation factor remaining at either RPI or CPI + 1.6%.



Retirement still 67 or 68 – and penalised for retiring ‘early’!

The document also talks of putting in place ‘actuarially fair’ early or late retirement factors on a cost-neutral basis. What this means, in essence, is that if a member has had enough of the job before their NRA/SRA of 67 or 68 (and most of us will have done by then, if we have not died in service) we will lose 3% of our pension for every year of ‘early’ retirement. This is, therefore, a very minor concession from the previous 5% actuarial reduction.



Plenty of employer protection – but we pay for it

There is also to be an employers’ cost cap, and a ‘guarantee’ of no further scheme reforms for 25 years. The cost cap means that if there are unforeseen significant increases in the cost of the scheme (such as people living much longer) then the extra costs will not be borne by the employers, but by the scheme members – we will pay more. This makes nonsense of the notion of a 25-year guarantee.

The document reiterates the 10-year protection notified earlier this year for those scheme members in the last ten years of their pensions, and adds some minimal linear-tapered protection for those in the next 3.5 years up to NPA – for every month beyond the last 10 years of the NPA, the member will lose 2 months of protection. However around 60% of current scheme members will get no protection at all.

For staff transferring under TUPE arrangements, the Fair Deal provisions remain for individuals but bulk transfers will no longer apply.

In another Annex, the document lists the areas to be discussed with the unions in early 2012 (which must also remain within the Government’s cost ceiling):

  • an Equality Impact Assessment to be carried out. But we should be aware that Equality arguments were used to raise the State Retirement Age for women to 65 and beyond;
  • abatement for service accrued prior to and post 2015;
  • phased retirement;
  • members who leave the scheme but re-join within 5 years;
  • contribution rates (years 2 and 3), and the impact on part-time and lower paid staff;
  • contribution rate distribution post 2015;
  • flexibilities for retirement pre Normal Pension Age.



Scheme costs

As far as we are aware, no union has yet done a full modelling of the cost and benefit comparisons of what is in the Heads of Agreement documents, which seems somewhat reckless on the part of those unions which have signed up to them.

An initial unofficial analysis of the overall costs for members of the TPS suggests that while a shift to a CARE scheme using the new accrual rate, and the revaluation figure of CPI plus 1.6%, may mean a cost-neutral transfer, or a marginal improvement, for some scheme members, others members, almost certainly most others over time, will lose out significantly.

In addition, when the rise in employee contributions, the reduction in indexing applied to pensions in payment, and the fact that newer scheme members will be expected to work until 67 or 68 are factored in, all members will continue to be far worse off over the lifetime of their pensions compared to the current situation.

For example, analysis suggests that an HE Grade 8 lecturer will suffer a total cumulative loss of nearly £200,000 (including £56,240 in extra contributions) over a scheme of 40 years, including a loss of £92,500 from three extra years of work.



CARE – why the employers and the government want it

It should be borne in mind that any worked examples over such a long time period will, of necessity, include certain assumptions about future inflation levels, career prospects, average pay increases and longevity in retirement. One of the great disadvantages of CARE schemes for employees is that the uprating of benefits accrued may be far more insecure in practice than for a final salary scheme, while potentially reducing the end costs for the employer.

Final Salary and CARE schemes will also tend to work differently for different groups of workers. This illustrates how important is the link between pay levels (and pay increases) and accrual of pension rights.

If there is reasonable progression through a salary scale, potential for promotion and decent annual pay awards, so that late career salaries are significantly higher in real terms than early career ones, then FS is generally a better prospect.

If salary scales are low and flat, there are few prospects for promotion and salary increase, and annual pay awards are low and/or below inflation, then a CARE scheme (as long as it is with a good accrual rate) may deliver a better pension, other factors being equal.

It is also worth asking why the Government may be prepared to offer slightly more at this point for some scheme members in order to get FS members to transfer over to a CARE scheme.

The first answer is that if they can get us to focus almost exclusively on the terms of a new CARE scheme to the exclusion of the other crucial factors, as outlined above, especially if they can get us to believe their oft-repeated mantra that CARE is fairer and better for the low paid, then we will miss the big picture.



The big picture is that the terms of the Heads of Agreement document will still leave us paying more, working longer, and getting less.

The second answer is that getting staff to shift to CARE is a useful precursor for privatisation. The financial services sector and the private employers have been lobbying for CARE against FS for years because it helps control their future employee pension costs by minimising the potential uncertainty and increased liability of the final salary element over the long term. Note the explicit provisions in the Heads of Agreement document relating to employers’ liabilities under TUPE and transfers. Note also the reference to the employers’ cost ceiling.



Conclusions

  1. An attack on our pensions or our conditions is fundamentally different to pay negotiation. The purpose of the trade unions when faced with an attack on pensions (our deferred wages) should be to stop the attack in its entirety NOT to aim to get the least bad deal. In a pay campaign it is possible to improve members’ pay and conditions, and negotiate over the degree of the improvement. When faced with an attack on pensions our aim should be NO DETRIMENT, since any compromise is a loss of current conditions, and to stop the attack completely.
  2. As a result of changes a few years ago we already have two categories of Final Salary scheme members (those with a Normal Pension Age of 60, and those with an NPA of 65). It makes no sense to add a third category of members on a new CARE scheme. This will become even more complex as some FS members transfer into the CARE scheme, and others do not, and some members opt out altogether. Such a multi-category scheme will make it harder for the unions to defend our members against the future attacks on the scheme which undoubtedly will come.
  3. The UCU, along with other teaching unions and public sector unions like PCS, Unite, Prospect and the POA, has not signed a Heads of Agreement document, and we believe those unions were right not so to do. For the unions to accept that members will work longer and pay more for lower pensions would mean that we would be selling the financial security of the vast majority of our members, especially the younger ones, down the river. This is especially true in Further Education where a higher proportion of lecturers are younger, worse paid than either school teachers or university lecturers, and typically on less secure contracts.
  4. To settle on the current paltry offer would also be a serious blow to the resurgence of resistance and organisation in the trade union movement, and a serious blow to the wider fight to stop the cuts and the Con-Dem Coalition’s austerity programme. Those who might claim that our fight is just about ‘bringing down the government’ ignore the fact that previous attacks on our pensions took place under New Labour. It is highly unlikely that a change of government would automatically result in pension security for teachers and other public sector workers.
  5. Despite some marginal movement to encourage TPS members to accept a CARE scheme in place of the current FS scheme, the financial disincentives for many members, and the other disadvantages associated with CARE, lead us to urge TPS members decisively to reject these scheme proposals.
  6. The 25 year guarantee of no further reforms announced in the document is meaningless. No current government can guarantee the policies of subsequent governments. The reforms in 2005/6 were supposed to be for a lifetime yet the this Government is back with further detrimental changes barely six years later. Blackmailers always come back for more. Doubtless members will be wary of such assurances, given the record of the Liberal Democrats at keeping promises, and the fact that the Coalition’s austerity programme was in neither party’s election manifesto.
  7. It remains the case that other aspects of the Government’s assault on our pension scheme are so detrimental (increased employee contribution costs, shift from RPI to CPI, later retirement) that members should continue, we believe, to reject the proposals and remain in dispute with the Government.

Hence, while there has been some limited re-packaging of the scheme’s parameters since the November 30th strikes, the Government has not withdrawn the most pernicious elements of its assault. The conclusion must be that we should pursue further industrial action, in association with as many other unions as possible, and as soon as possible. Now is the time to escalate our action. It is not time to call a truce.

We should make sure our union leaderships and negotiators remain fully accountable, and are made aware of our opposition to any shoddy deal based on the current offer. Branches and individual members should bombard head office, and their NEC members, with motions and messages by phone and email urging rejection, and arguing for an early resumption of strike action.

We should continue to urge members to sign the online Statement to reject the offer which has already attracted close to 3,000 signatories (go to http://bit.ly/rJ8SGJ).

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We are very grateful to London Retired Members Branch Secretary, Steve Cushion, for some of the figures included in this analysis. The link to the full report is at: http://www.ucu-retired-london.org.uk/pdf/pension-report.pdf

We urge you to visit the new UCU Left website www.uculeft.org . You can also sign up to UCU Left from the website.

Unite the Resistance is holding an emergency conference on the pensions issue on Saturday 14th January. Visit the website for details: www.uniteresist.org

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Pensions: Where We Are Now?

On Monday local government and health unions signed up to a heads of agreement document outlining the priorities for reform to their pension schemes and for further pension negotiations in January. Cabinet minister Danny Alexander then made a triumphalist statement to Parliament on Tuesday, emphasizing that there had been no concessions with any cost implications during negotiations with the trade unions (i.e. the ‘concessions’ merely represented a redistribution of the burden of the pension cuts).

There was little reference to the fact that the main teaching unions, NUT, NAS/UWT, and UCU, had ‘reserved their positions’ subject to meetings of their national executives, and a possible ballot of members. The ire of the Government was directed at the Public and Commercial Services (PCS), the largest union representing civil servants, for rejecting the deal out of hand.

Clearly, the hope was that the Government’s apparent victory in local government and health would create an atmosphere in which the other unions would find it difficult to continue the struggle.

Within 24 hours, however, the agreement was beginning to unravel, and might yet do so completely. The local government unions reacted furiously on Tuesday afternoon to a letter from Minister Eric Pickles which claimed that the deal included a cap on employers’ pension contributions. Unison, the GMB and Unite suspended their agreement pending talks with the Government, accusing Ministers of a ‘failure of trust’.

There has, in addition, been enormous pressure from branches and members. In the unions that had accepted the agreement many want the negotiators to step back, and to continue to defend existing pension arrangements. These demands have been fuelled by the obvious success of the November 30th (N30) strike, and by the expectation, expressed in most if not all rallies on the day, that the action would recommence in January, and that compromise was not what the struggle was about.

Civil servants and teachers schemes – no deal!

Agreement had not been reached in either the civil servants’ or the teachers’ scheme talks. PCS rejected the proposals on the basis that there was nothing new on offer from the Government since before the mass strikes on November 30th.

The statements from the NUT, UCU, NASUWT and UCAC described these unions as ‘reserving their position’. The UCU statement declared that, “following receipt of all documentation and further clarification the proposals will be considered by the NEC, and then all members in TPS will be balloted on whether to accept or reject the offer”.

The future of the dispute

The PCS rejection, the fact that deals were not signed on Monday in the civil servants’ and teachers’ pensions schemes, and the on-going debate in the local government unions about the agreement over the deal among the local government unions means that the future of this dispute, and the securing of existing pensions arrangements, are still an open question.

There are already (in the first few days after the proposed settlement) almost two and a half thousand signatures on the statement for rejecting the Government’s offer (see http://bit.ly/rJ8SGJ) including some 16 members of the National Council of Unite, and a large majority of National Executive members of UCU in the TPS.

There will be a series of NEC meetings and ballots across a variety of unions in the New Year. Millions of public sector employees did not strike on N30, merely to get a rebalancing of the Government’s attempted cuts to pensions. The success of the day, and the fact that it was seen as the beginning of the fightback, will have caused many to wonder how a settlement could be announced, or a deal recommended, without any concessions from the Government.

It is clear that the current proposals on public sector pension reform continue to mean that public sector workers will be expected to work much longer, contribute much more, and receive much less from our pensions. Employee contributions remain set to rise by approximately 50% over the next three years. Indexation will remain linked to the lower CPI inflator, not RPI. Younger members, and those in mid-career, will be expected to work until 66, 67 or 68 until eligible. For those in TPS, there is still the transformation of the scheme from a ‘final salary’ to a ‘career average’ pension.

The Government’s claim that no further changes will be sought for decades is, moreover, meaningless since no government can make such promises about the behaviour of future governments. A similar rhetorical undertaken was given when public sector pensions were reformed in 2006/7.

There is no affordability crisis!

The Government, as with the Hutton Report earlier this year, has failed to demonstrate the economic necessity for public sector pension reform. None of the pension schemes are in current or projected shortfall, and they are all demonstrably affordable at present contribution rates. This is an aspect of the dispute that is continually ignored in media coverage, an omission that statements from our side have not yet overcome. Indeed it is only the proposed 50% increase in monthly contributions which, in possibly driving younger or early career teachers out of the TPS, might threaten the scheme’s future viability.

The NAS/UWT statement made the point succinctly:

The Coalition Government has still not provided any information on the need for reform to the TPS, and today’s [Monday’s] statement confirms that teachers will be expected to pay more, receive less and work longer for their pensions.

The Government‘s private rationale for the changes are easily discernible. Given that the changes are not necessary financially, there is a clear dual aim:

  • to lower the cost to public sector employing departments, and thus to redirect funds in favour of the deficit created by the banking crisis, and to facilitate privatization in the post-16 education sector; and
  • gradually to transform an expectation and tradition of collective provision for old age (through existing funded schemes with final salary provision) to resignation in accepting a move to individual responsibility for retirement (through the stock market wager on ‘money-purchase’ schemes).

The latter intent is why the Government is not excessively concerned about the future viability of schemes whose increased contributions might render them non-viable as a result of the deterrent effect.

What next for UCU, and the defence of TPS?

A special NEC meeting is to be called in early January. It will review the Government’s proposals, and recommend acceptance or rejection in a ballot of members of the TPS. I, along with other UCU Left supporters, will urge members of the NEC to recommend rejection, and in the ballot will urge members to reject the proposals.

The UCU campaign was:

  • against any increase in contributions as financially unnecessary for the scheme and unaffordable for some at a time of declining real wages;
  • against any increase in the retirement age, as financially unnecessary professionally ill-considered, and a breach of contract;
  • against any cuts to pensions from a move to CPI as a contractual breach and a deferred wage cut;
  • against the move to ‘career average’ as a breach of contract, and a worsening of pensions without a shift to an unattainable accrual rate.

This was the policy position adopted overwhelmingly at successive conferences, and reasserted by the NEC. None of these things have been achieved in the Government’s ‘final offer’. Hence the offer should be rejected, and the campaign of industrial action should recommence as soon as possible, and should escalate through the year.

The UCU will then need to plan for further strike action, in conjunction with the other teaching unions and the PCS (and with those other unions whose members may yet reject the Government’s amendment of the cuts).

I urge UCU (TPS) branches to meet as early as possible in the New Year to discuss the situation, and to pass motions rejecting the proposals as inadequate and unacceptable. I urge branches to call on our union leadership to organise further national strike action alongside other unions in the New Year.

Don’t give up the pensions fight

***** Update 9pm Tuesday 20th Dec – Please Distribute Widely *****

Dear all,

Well, It appears the disturbing stories circulating since Thursday evening that the Government had issued an ultimatum to public sector unions over the pensions dispute, and that some trade union leaders, notably Brendan Barber (TUC) and Dave Prentis (Unison Gen Sec), were arguing we had to give in to such bullying and abandon our fight for decent pensions, were unfortunately correct.

This despite the Government pressing home their contempt for us last week by stating they will impose contribution increases for teachers (TPS) and civil service workers from April – See the earlier BBC report at: http://www.bbc.co.uk/news/mobile/business-16238468

However, as well as PCS rejecting the Government’s ultimatum, most of the teaching unions: UCU, NUT, UCAC, NASUWT, and EIS, have also refused to sign and are ‘reserving’ their positions pending meetings of their respective executive committees in the new year.

Members should be demanding that those executive meetings reject the ‘offer’, and that we should be working together – alongside PCS, in organising for escalating industrial action in order to win our just and continuing demand of Fair Pensions for All

The following statement: “Don’t give up on the pensions fight” was launched last Friday by a number of public sector trade union activists, myself included. If you continue to believe we shouldn’t give in to Government bullying, that we shouldn’t be paying more, working longer and receiving less, then I urge you to sign the statement now and circulate it as widely as possible – already over 2,100 trade union activists have signed since its launch.

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Don’t give up the pensions fight

The government’s “final offer” is no improvement. There is no extra money on offer. The government still wants public sector workers to work longer, pay more and get less. They haven’t moved on core issues:

* Fifty percent rise in pension contributions.
* Normal pension age to rise to the state retirement age. Retirement at 68 for those 34 and under.
* Pensions indexed at CPI instead of RPI. A cut for all existing pensioners.

We agree with those union general secretaries who are against accepting this offer. We ask all union general secretaries, if it was right to strike against these proposals on November 30th how it can be right to accept them now? Ordinary trade union members have demonstrated their determination to resist these unfair and unnecessary changes; we call on our trade union leaders to reject the Government’s bullying tactics and reject their unacceptable offer.

Initial signatures:

Alex Kenny NUT Executive member (Inner London)
Andrew Baisley Camden NUT branch secretary
Dave Harvey NUT Executive member (Outer London)
Martin Powell-Davis NUT Executive member (Inner London)
Mark Campbell UCU National Executive member
Liz Lawrence UCU National Executive member
Sean Vernell UCU National Executive member
Loraine Monk UCU National Executive member
Christine Vie UCU National Executive member
David Armstrong UCU National Executive member
Guy Stoate UCU National Executive member

Sign the statement here: http://bit.ly/sVyIla
View current signatories here: http://bit.ly/rJ8SGJ

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In solidarity

Mark…

Mark Campbell
UCU London Metropolitan University (Chair)
UCU National Executive Committee (London and the East)

Reclaiming Education

The Government’s White Paper will affect further and higher education equally. Unless successfully resisted, it will force the market on the post-16 education sector. Some colleagues may think that by staying silent they will save their courses. Any such idea of safety in passivity is mistaken. I appeal to all to stand up for education. I want all who want to fight for education, and against the market, to unite in a determined defence of education as a public and social good.

Reclaiming our institutions

We need to reassert academic and scholarly control of our colleges and universities. We need to insist on public service not only as the reason why we came into education but also why we stay. We need to insist that our educational institutions serve the communities of which they are an integral part.

We have become too accustomed to a language of ‘aims’ and ‘objectives’, of ‘module descriptors’, of accounting criteria to determine the quality of course provision, and of a meaningless ‘peddababble’ on outcomes and achievement. We have the absurd prospects of managers determining the academic curriculum in relation to the requirements of local commerce, of information managers reinventing libraries as social spaces unencumbered with books, and of research administration subverting the academic role of supervisors.

Our union has as yet done too little to resist the drift, despite the admirable research and propaganda material produced by our staff. Now it is time for us to say, ‘No more’, and to reverse the trend of the last two decades. We need the democratization of education.

We need our reps to be involved in their local communities, and our members in universities to challenge for representation on faculty boards, academic boards and on Senates. We must seek the overhaul of institutional procedures. We need a union that does not think that this battle is lost already, one that will dovetail its defence of members’ jobs and conditions with this educational initiative to reclaim the institutions – to win them back from the rampant managerialism that has overcome them.

Jobs and conditions of service

We have learned the lesson of timidity on the question of jobs. If not, we should have done. Where we fight we win, and we do win; where we seek compromise we disillusion our members and supporters, and we harvest defeat.

Beyond that willingness to act there is the question of what it is that we are acting for. In the face of a threat to jobs, are we fighting to preserve the jobs and the courses and the support on which they depend, or are we only fighting against compulsory redundancies and for better severance terms? This is a sharp question that confronts us.

We need to unite our defence of members’ interests with a defence of educational provision as the pivotal element in the defence of employment security and the terms of employment. We can no longer, in this new climate, hope to secure our sectional interests as a group of employees without embracing the need to defend the jobs and conditions of all, and the service provided to students and the wider community by the FE and HE sectors.

The union we need, and the union we deserve

We need well-organised branches, and well-trained officers. None of it can be achieved without debating our priorities to get a resolution in which all members can invest.

We need to preserve our capacity to debate the implementation of policy regionally in our Regional Committees. We need to involve the largest possible layer of members in the union’s democratic structures in the determination of policy – in attending Congress, and our HE and FE Sector Conferences. Our National Committee must reflect all of the union’s constituencies, and have a procedure that prevents the dominance of any at the expense of the others.

This is how we pull all sections together in a common fight. There is no Chinese Wall between organization and combat effectiveness for a trade union in this new and austere climate. Every argument about organization is an argument about what the UCU is for, and about the imagination and willingness to fight.

After N30 – what next?

This is not a protest! This is a campaign that we intend to win.

Nov 30 was a magnificent response to the Government’s attempted theft of public sector pensions. Teachers, borders staff, technicians, social workers, librarians, garbage collectors, painters, electricians, lecturers, researchers, janitors, cooks, secretaries, researchers, … the list is almost endless, joined the greatest strike action in decades. This is a clear signal to the Government that we will not tolerate our pensions being savaged:

  • our pensions are not in financial jeopardy so we will not tolerate them being raided to pay for bank bailouts;
  • we will not tolerate the breach of our contracted terms on age of retirement;
  • we will not pay a penny more than we contracted for, or accept a penny less in benefits;
  • we will not consider a switch to ‘career average’, with all the losses this would entail, on empty rhetoric about ‘fairness’ and ‘equity’ from a Government oozing hypocrisy and privilege from every pore.

The Government strategy

In the face of this level of opposition, and with the prospect of escalating action in the New Year, the Government’s strategy is divide and rule. It is desperate to drive a wedge between the unions that mobilized for the strike on November 30th.

Till now, the Government sought to isolate public sector employees from those in the private sector. Now it is seeking to divide one set of public sector employees from another. It is desperate to get one or two public sector unions to break ranks, and to accept a compromise.

A compromise solution?

Its strategy has failed. All of the unions, from the PCS to Unison, from the NUT to Unite, from the UCU to the ATL, … have said “too little, too late!” The Government has claimed that the unions were very close to a compromise deal – a deal that the Government would take off the table if the strike on the 30th went ahead – but all of the unions’ leaders know three things:

  • compromise would give up part of a pension that is in members’ contracts, and that the sacrifice would only be to pay for the bankers’ crisis;
  • compromise would be unacceptable to the vast majority of those striking on the 30th;
  • any trade union leadership that would seek to sell a compromise to its members would only manage to compromise its own very survival.

Defending our pensions is not like fighting for a wage increase. In wage bargaining, compromise is the norm, with a settlement reached between the existing rate and the claim. In pensions battles, by contrast, any compromise means that the pensioners lose. It is not really a ‘compromise’; any ‘compromise’ is a defeat. It means that we lose what we already had.

One union after another has denounced the Government’s lies.

The way forward after Nov 30th

The Government is not going to abandon its plans because of a one day strike. When the UCU first took action alone, it was to encourage other unions to join in the campaign sooner. When the NUT, ATL, PCS and UCU took action together on 30th June, we did not think that this day alone would be able to stop the attack. Now, with a generalized fightback across the public sector, we should not suddenly become subject to the illusion that one day is enough.

The Government is worried, and on the back foot. It is watching the action carefully, desperate to detect any weaknesses in our ranks. We need to convince the Government that we are not going away after November 30th. This is not a protest, after which we will go home with a shrug. Every Minister needs to know that we are in this to win.

Escalation

To do that we need the earliest possible agreement between the unions on how the action is to be extended and escalated after Christmas. We need:

  • another one-day strike in January;
  • rolling regional action across the country;
  • a 48-hour (2-day) general stoppage in February.

Trade unions’ Executives need to debate escalation and a timetable as soon as possible.

Another Education is Possible – A UCU Left publication – Available as a pdf and ePub now.

New UCU Left website online now.

HE White Paper: What Everyone Needs to Know

Video of an LSE Student Union and LSE UCU public briefing meeting on the Higher Education White Paper – held on 26 October 2011.

click here for video – approx 80 mins

Panelists:

Mark Campbell: London Met UCU and UCU NEC;
Mary Evans: LSE Gender Institute;
John Holmwood: Department of Sociology, Nottingham University;
Samir Karnik Hinks: Student activist, King’s College London;

Chair:

Amena Amer: Education Officer, LSE SU

An offer you can refuse

By Julian Atkinson, East Midlands Retired Members UCU Branch

The Government has made a slightly improved offer on its changes to Public Sector Pensions (PSPs). This is being spun as generous. It is not; it is still a big cut. Danny Alexander, Chief Secretary to the Treasury, said the new offer involved an increase to the cost ceiling, so that future schemes would be based on a pension to the value of 1/60th of average salary accruing for each year worked – compared to 1/65th under the previous offer. He added that, under the latest proposals, with increased contributions and an increased retirement age, a teacher with a lifetime in public service and a salary at retirement of £37,800 would receive £25,200 a year pension, rather than the £19,100 currently. These figures however are based on scheme members paying more and working up to 8 years longer! The TUC’s general secretary Brendan Barber said there were still “major areas of concern”. He took issue with government claims that nobody retiring in the next 10 years would be adversely affected and said there was “manipulation” of figures.

There will also be increased contributions and the linking of normal pension age to the rapidly increasing state pension age with the consequence that earlier retirement will be subject to actuarial reduction.

The central change proposed is from a final salary to a career average (CARE) scheme. The present accrual rate in the Teachers’ Pension Scheme is 1/60th and proposed rate for the CARE scheme is 1/60th. This involves a reduction in pension. An OECD report quantifies this. ”A switch from final salary to career average (both with price indexation) but with no change in accrual rate leads to a reduction of over 40% in pension liabilities” (Blome et al “Pension Fund Regulations and Risk Management” OECD 2007). To prevent this, the accrual rate has to be dramatically improved. Sutcliffe (Charles Sutcliffe “Should Defined Benefit Schemes be Career Average or Final salary” University of Reading ICMA Discussion Paper 2007-6) argues that it has to move from 1/60th to 1/47th.

The other component of a CARE scheme is how accruals are revalued to take into account the effect of inflation. It appears that this will be in line with the average earnings index but this index gives a lower revaluation than that associated with the final salary (D.R. Cooper, Journal of Pensions Management v. 4 no. 2). This then exaggerates the deterioration in pension associated with a static accrual rate.

The only way the “improved” pension figures can be produced is through the increase in employee contribution up to 9.6% and making the employees work longer. The pension age is scheduled to rise to 66 and then 67 but the signalling of a pension age of 68 has already begun. And far sighted visionaries in the pensions industry are arguing for a move to 70. These proposals from the Government have to be rejected.

BARNSLEY COLLEGE VICTORY

Branch Officers at Barnsley College agreed today to call off our planned 5 day strike to stop Graham Mustin, one of our UCU branch secretaries, being made compulsorily redundant because he has been offered, and accepted, a new job. It is clear that this would not have happened if our members had not voted so overwhelmingly to take 5 days of strike action. The unity and determination of our members has been matched by the overwhelming support we have had from UCU branches and other trade unions around the country.

Our college management has tried every trick available to them in the last 10 days to undermine our action. The principal has condemned our union branch as taking extreme, unrealistic and disproportionate action out of step with UCU members in other colleges. He has tried to insist that we provided full cover for the classes we were going to miss by being on strike! He has tried to use the law to argue that our ballot was no longer legal because we balloted against compulsory redundancies and as there was now only one redundancy our mandate no longer applied! None of them has shaken our members’ resolve. And in the end they have backed down, not us.

We will be taking the message of our victory to the UniteThe Resistance Convention in London on Nov. 19th and the Sheffield UTR meeting on Nov. 10th. It demonstrates that if we stand together we can win. The slight government shift on pensions teaches us the same lesson. We are now organising flat out for Nov. 30th!

(Thanks to all those branches and individuals who have sent us donations. We have not cashed any of them and do not intend to do so now. Your solidarity has helped us win. And we will not now be holding our planned demonstration on Saturday.)

Please circulate this message as widely as possible.

Dave Gibson (Barnsley College UCU and NEC)

What sort of UCU do we need?

All in our union will agree. We are facing an unprecedented battle in the face of a Government determined to impose the will of the market on everything, and to abolish what remains of the welfare state, publicly funded education, and the National Health Service. Its justification is the reduction of the deficit but that is no more than an excuse.

There are few who would disagree with this assessment. The question is: what must we in education do to defend our universities and colleges, and our role as scholars and teachers and related staff, and what kind of UCU do we need to organise that defence?

My position is easily summarised. It sets me apart from my chief challenger for the post of General Secretary. It provides the choice between perspectives for this struggle that members need in this election.

I stand for a UCU that is led by its members rather than its national officials through the democratic structures of Congress, conferences, regional committees and the elected lay officers of the National Executive.

I stand for a union that is committed to getting the best conditions for members, not just as a self-interested end in itself, but as a central part of defending public universities and colleges. I stand for a union that will find a way for members to use the union’s power to defend their academic independence from the strictures of the REF, from the ‘pedababble’ of academic audits, and from impossible workloads and conflicting demands. I stand for a union that values all its members and will campaign hard for its most precarious – hourly paid lecturers, Graduate Teaching Assistants, and junior researchers – all currently on a variety of exploitative casual contracts.

I stand for a trade unionism that is willing to mobilise in opposition to Government education policy, and to defend our students when they make their sacrifices for future generations. That is a unionism that will act on its belief that a cohesive society requires social solidarity, including that inter-generational solidarity that is represented by the provision of education as a public good, and pensions as a social rather than an individual responsibility.

Members of the UCU have an important choice to make between the candidates. All of the candidates, it is to be hoped, will honour the democratic structures of the UCU, and abide by Congress and Conference decisions. The issue concerns the vigour and enthusiasm and commitment they will have in advancing those policies, and the imagination and leadership in the stuggles that they can bring to bear.

My view of the UCU and its remit is captured in three key propositions:-

It is an organisation of educationalists for whom the defence of scholarly integrity, academic freedom, publicly funded institutions, and the pay, pensions and conditions of tutors, academic and related staff, are not separate struggles. All are related, and being forced together by the Government’s assault on them all. In this, the struggle to defend pay and conditions is central to the defence of the public character of our colleges, services and universities. It would be a strategic mistake to treat them as distinct battles, and would divide the UCU from others in the movement, one section of the union form another.

Effective resistance to the HE White Paper (and its Scottish derivative) and its proposals for creating a hierarchy of institutions and for abolishing regulation to facilitate the private providers, requires devising the appropriate industrial response.

In all of this, the UCU needs to play to its strengths – its democratic and representative structure rooted in its branches. The UCU is not a grandiose electronic focus-group acting as an appreciative audience for the performance of its leaders. It is an organisation of engaged and reflective members. It is, moreover, an organisation of members who are willing to fight to defend the education system in which they chose to make their careers.

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