What we think
Pensions struggles still loom
FOR THE best part of two decades, big business has slashed and burned
its way through the pension funds and entitlements of working people.
Both internationally and in Britain, the bosses are pushing governments
to carry out a further wave of attacks on workers’ pension rights
through cutting public-sector occupational pensions and the state
pension.
The recent climbdown forced on the British government over
public-sector occupational pensions began to swing the pendulum away
from the bosses’ offensive.
When the framework agreement on public-sector occupational pensions
was reached – protecting the pension rights of existing workers in
health, education and the civil service – Britain’s bosses foamed at the
mouth about this being a return to the union power of the 1970s and an
abject capitulation by the government.
The socialist warned at the time that a battle had been won but big
struggles still loomed. The bosses would not lie back and accept this
settlement; primarily because it showed workers – in both public and the
private sector – that the pensions’ offensive could be rolled back.
Now, with the publication of the Turner report imminent, the CBI has
been pressuring Chancellor Gordon Brown – as prime minister in waiting –
to overturn the public-sector pensions agreement. At the same time Brown
is pursuing other battles with Adair Turner, chair of the Pensions
Commission, and Tony Blair about the future outline of public spending.
CBI members have said their members and employees are furious about
public-sector workers being allowed to retire at 60. As the articles on
page one and below show, retirement at 60 is not a realistic option even
now for many public-sector workers.
And, the bosses’ concern for their workers would be touching were it
not so hypocritical. The reason they claim to want the public-sector
deal overturned is because it will make harder to get their employees to
work till the age of 67 without a final-salary pension scheme.
Unite struggles
THE PENSIONS debate has intensified in the last week because, at
root, all sections of the capitalist class in Britain, including
government ministers, want to reach a new pensions settlement.
But they want one that guarantees their gilt-edged pensions and
profits and privileges and that, one way or another, attacks the
occupational and state pension entitlements of working-class people.
However, a growing obstacle lies in their way. The refusal of
public-sector unions – led by the PCS – to accept increased retirement
ages for existing workers has shown private-sector workers you don’t
have to accept the ‘work till you drop’ mentality of big business.
Private-sector workers are also beginning to fight back against
pensions robbery. Six thousand British Gas engineers who are GMB members
voted four-to-one to take strike action to defend their final-salary
pensions. The union has announced five 24-hour strikes.
The pensions’ uproar in the last week reveals a number of things.
Firstly, the threat of united public-sector action forced the
government to concede more than it intended. Secondly, despite the
complications about new starters, the unions were correct to sign the
framework agreement to protect the rights of existing members of
public-sector pension schemes.
Had they not done that, Brown would now be driving a coach and horses
through any negotiations. For now, the agreement is a bridge head which
has got the government and bosses on the back foot.
Brown in particular is playing with fire over pensions and
public-sector pay. If he attempts to rip up the pensions deal, then
millions of public-sector workers and others will have no alternative
but to return down the road of united, mass industrial action to defend
their pensions.
Moreover, the bosses’ statements last week emphasize the urgency
needed for pushing the TUC to call a national demonstration on pensions.
This demonstration, agreed at September’s TUC, must aim to link
private-sector, public-sector and pensioners into a movement to repel
big business and government attacks and achieve a pensions settlement
that decisively shifts the balance in favour of working people.
Reject the bosses’ propaganda
LIAR, LIAR, Digby Jones’ Saville Row pants are on fire. Sir Digby,
the head of the CBI bosses’ organisation is retiring from that job this
week at the grand old age of 50! During his time as the boss of this
organisation he has accumulated a pension pot worth millions.
Jones and other top bosses are calling for the government to tear up
its recent framework deal that allowed current public-sector pension
scheme members to retire at 60. And they are spreading the most
disgusting lies about the pensions of low-paid public-sector workers in
the process.
Lie number 1: Civil servants, health workers and other public-sector
workers can retire at 60.
Not true. All these workers currently have the right to start drawing
their occupational pension at the age of 60 provided they have done
enough service and made enough contributions. Many of them only end up
with a pension of a few thousand pounds and work on till they are 63 or
64 because they cannot afford to retire on such a paltry sum. If the
state pension age is raised to 67 then it will be impossible for them to
retire at 60 even if they are entitled to.
Lie number 2: Funding public-sector pensions will cost all taxpayers
£700 billion.
As one economist once said, statistics will confess to anything if
you torture them long enough. The fact is, that all figures about future
current public-sector pension liabilities are at best educated guesses.
Moreover, the figures for future liabilities range from £500 billion
to £700 billion and these liabilities extend over 50 years. And, most of
the money for paying out for these pensions actually comes from the
money low-paid workers have set aside over decades of work.
Lie number 3: Private-sector workers are having their pensions cut to
pay for public-sector pensions.
This is rubbish. Private-sector pensions have been cut for years
because the bosses took ‘pension holidays’ ie stopped contributing into
the pensions’ pot because share values on stock markets were rising –
only to be followed by a crash, leaving a huge ‘black hole’ in pension
funds. From a £80 billion surplus in 2000 company pension funds went
into a £77 billion deficit by 2002!
Some bosses even took money out of their pension funds to fund
investment and dividend payouts and haven’t replaced it yet. Now, they
claim their funded pension schemes are in crisis and their workers have
to take a pay cut. It hasn’t stopped the bosses increasing their
final-salary pension schemes however.
The directors of the UK’s top 100 companies now share pensions worth
almost £1,000,000,000. For directors with the biggest pension at each
company, the average is £288,000 a year, 45 times the average for all
employees.
