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From The Socialist newspaper, 27 October 2005

What we think

Pensions battle not over - but Labour in retreat

THE PENSIONS battle is far from over. But, the preparedness of millions of public-sector workers to take united action has forced the Labour government into its second major retreat over this issue within six months by agreeing to maintain existing workers' conditions.

The reaction of capitalist commentators has been universal condemnation of the Labour government bowing down to the pressure of the unions.

The Financial Times called it "abject surrender" and "Labour caves in over pensions".

Digby Jones, head of the CBI bosses' organisation, was apoplectic when debating with civil service union PCS general secretary Mark Serwotka on Channel 4 News. He said: "We're going back to the 1970s with the unions calling the shots".

The actual deal was brought about because the government was seriously worried by the united front shown by workers preparing to struggle through militant industrial action.

Digby Jones, along with Financial Times leader writers, were most concerned the example of public-sector workers would be followed by private-sector workers, or that workers in Britain would follow the example of French and Belgian workers in conducting militant industrial action to defend pensions.

But the militancy of public-sector workers was not matched by all their leaders, most of whom have had to be pushed kicking and screaming into opposing attacks on pension rights. Even up to the last moment, some union leaders wanted to accept an offer by cabinet minister Alan Johnson to settle for the extension of implementing the proposals until 2013 or 2018.

They compared the PCS leadership to the NUM of the past, suggesting the government would never concede an arrangement for all existing staff and would move to crush the unions. PCS in particular held firm to the line of no detriment and no breach of existing "contracts".

Years of attacks had seen the unions on the defensive and the government on the offensive. And, after years of retreats it can sometimes be difficult to recognise how things are beginning to change.

Local government

EARLIER THIS year, pressure from members pushed most of the local government unions to ballot for strike action on 23 March against government plans.

The first pension scheme in the firing line was local government, with the government passing legislation to cut their pension rights from April 2005. Strike ballots amongst UNISON, TGWU, Amicus and UCATT local government members voted heavily in favour of strike action. Regrettably, the GMB union did not ballot all its members but ballots in three regions showed members in favour of action.

Other public-sector pension schemes in health, education, fire service and civil service were due to be detrimentally changed from April 2006.

The socialist leadership in the PCS saw an opportunity to link together struggles of different groups of public-sector workers and ballot their members for action alongside local government workers on 23 March. This showed a clear understanding that it's best to act together whilst being prepared to act alone if necessary to defend their own members' interests.

PCS could do this because the union had developed into a more cohesive union, following years of right-wing misrule, through taking strike action over job losses under the new Left leadership. This was despite its membership being drawn from a diversity of backgrounds - from low-paid Jobcentre workers to Ministry of Defence workers at GCHQ and in the High Courts.

PCS had successfully got through a motion at the previous autumn's TUC for unions to give a commitment to united action on pensions - despite opposition and prevarication from some other unions.

The PCS leadership organised their strike ballot - to support strike action simultaneously with local government workers - on the issue of government statements about increasing the retirement age for all public-sector workers from 60 to 65 and refusing to conduct serious negotiations.

Some other non-local government unions made noises about action, but their union leaderships delayed making a decision, meaning they could not take strike action alongside local government workers.

New Labour's retreat, prior to the general election, when they promised to revoke local government pensions legislation, was partially a result of this united stand of council unions and PCS. And, whilst the government promised to conduct serious negotiations with the unions on their pension plans, the socialist warned at the time that New Labour retreated because of the imminent election, meaning the unions needed to maintain a united front in preparation for future action.

This again was the material force that the government had to recognise when it conducted its retreat last week. It also had an eye on how, given the growing anger against Blair's government, a generalised movement of the working class could develop on pensions.

What should happen now?

THE GOVERNMENT'S climbdown from imposing a retirement age of 65 for existing staff now means that negotiations about what happens to new starters takes place sector by sector.

Clearly, New Labour hope to make most savings through introducing a worse scheme for new starters - effectively a two-tier scheme with new starters either having to pay more to keep retirement at 60 viable or working on to 65.

Understandably, this has caused some anxieties amongst workers and activists in the trade unions who correctly see the dangers and problems of a two-tier scheme (see article on page 3 on Whipps Cross). Much detail still needs resolving in the negotiations before any union should sign on the dotted line.

What's more, local government and fire service workers still possibly face the government imposing worse conditions for existing and future members of their scheme. Other public-sector workers will not want to see them left isolated - particularly after the successes of standing together against the government.

UNISON general secretary Dave Prentis has made statements accepting this uncritically as a wonderful deal, without addressing the protection of local government workers. This may have complicated the prospect of fighting back should the government choose to impose worse conditions.


There are issues to be resolved, with the need for the widest consultation amongst public-sector union members about the implications of this framework agreement. But it nevertheless represents a serious setback for the government's pension proposals and plans to take on public-sector unions.

However, the question of what the unions should now do, whether or not to reject what is on offer (keeping the present conditions for existing workers) is the concrete issue most workers now want addressed.

The PCS NEC meeting last week endorsed the deal, welcoming the continuation for existing members of their right to retire at 60 without detriment. It emphasised that this came about through trade union unity - drawing the lesson that this unity should be a base for other campaigns, such as against privatisation of public services.

It also agreed to have a members' ballot once the negotiations conclude for the new entrants' scheme.

For the PCS, along with other unions, to reject the deal now means going back to the members to argue for strike action to defend future new starters in the civil service. Sometimes it's necessary to put down a marker for the future and go to the membership even if you expect to lose. But in this case most members would say: "We hear what you say about future members but to ask us to take strike action now when we have kept our arrangements intact seems a step too far."

Under these circumstances it's unlikely a vote for strike action would be successful.

And, to be defeated in a ballot would have consequences, including giving a weapon to the right wing in the unions, especially those in the PCS who are waiting to see the leadership rejected by the membership.

However, the union must demonstrate to young people that they are not forgotten and that their rights will be protected in the negotiations.

The whole process of the battle over pensions is one of the most important lessons for the workers' movement in the last decade.

The government's retreat in the face of united struggle shows to those most involved and broader layers of the working class that action and the threat of action can force the bosses to retreat.

Workers now realise unity brings dividends but they also will conclude they need a leadership that knows what it is doing and - like the PCS - how to keep the confidence of union members.

Workers can fight two-tier conditions!

TWO-TIER (and even three-tier) schemes on pay and conditions are now the norm across industry and services. The privatisation of many parts of the public sector has led to new workers being put on worse terms and conditions than those transferred from the public sector.

When workers across the public sector found that their jobs were being privatised the main demand was to keep the same trade union-negotiated terms and conditions with their new employer as they had with their old employer. This was the case in the NHS, the civil service etc.

The transfer of undertaking regulations (TUPE) became the norm and even allowed certain union leaders to say 'it doesn't matter who you work for as long as you have the right conditions'.

Only much later did the whole issue of the two-tier workforce become prominent. Even then, the unions' main approach was to demand the government legislated to end the two-tier workforce by inserting clauses about workers' conditions into private employers' contracts.

There has been no significant case where workers protected by TUPE regulations and transferred to the private sector, were prepared to take action in advance on behalf of new employees who were coming in on worse conditions.

But battles such as at Whipps Cross hospital in north-east London, show how workers' anger could develop over time to the point where a successful struggle could be waged. The strike was under the leadership of Socialist Party members. As new workers joined the privatised cleaning company, they were recruited to the union, UNISON.

Once a significant number of those workers were organised, the idea of striking to obtain parity of wages and conditions with workers previously employed by the NHS could be campaigned for.

After this quite lengthy campaign amongst workers who often had no experience of trade union organisation, it was possible to take successful action, supported by workers who had little to gain personally.

Belgian workers fight pension cuts

ON 28 OCTOBER members of the two major trade union federations in Belgium will unite in a joint day of action against government attacks on pensions.

The government want to force the retirement age up from 58 to 60 and make it more difficult to retire early.

On 7 October there was a general strike called by the social democratic trade union federation but which was supported by workers from both federations. The union leaders have now been forced to call this joint action.

There have already been large meetings and local strikes in the build-up to this action, which LSP/MAS (CWI Belgium) has been participating in - arguing for the formation of a new mass workers' party. None of the establishment parties support the workers' struggle.

LSP/MAS have launched an internet petition for those who want to support the foundation of such a party.

Tanker drivers' pensions strike

SEVENTY FOUR tanker drivers, members of the TGWU, are due to strike for five days from 28 October. The drivers have recently been transferred from Exel to BP but without their final salary pension scheme.

BP are trying to force them onto an inferior money purchase scheme.

The union has pointed out that BP boss Lord Browne seems quite happy with his final salary pension scheme. But "maybe the fact that his petrol won't be delivered to forecourts will wake him up."

Final negotiations are planned for 26 October.

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In The Socialist 27 October 2005:

Keep 'the market' out of schools

United against fascism

Rioting in Lozells

Come to Socialism 2005

Conference for action needed for new mass workers' party

Socialist Students -

Pensions battle not over - but Labour in retreat

Stop these drastic hospital cuts

Defending trade union rights

The politics of relief: political manoeuvres begin


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