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Public sector workers tell us why they walked out

steve_tolley.jpg

This week’s strike closed three quarters of the schools in England, saw police providing cover to the London Ambulance Service and 26,000 civil servants walk out. Unions say two million people were involved. The Prime Minister called the day a damp squib, claiming less than half that actually took action.

The strike was prompted by reforms to public sector pensions which the Government and many pension experts say are vital to ensure they are sustainable in the long-term. Union leaders say they want to reach a deal but the Government is being unreasonable and not negotiating in good faith. Money Marketing’s political reporter Steve Tolley was on the streets with the strikers to find out why they believe the reforms are unnecessary.

Ministry of Justice fines officer Patrick Wheeler (pictured) says, for him, the strike is about the Government refusing to honour contracts.

“For me personally it is a matter of honour. The Government says to us it is contractually obliged to pay massive bonuses and massive pensions pots to the directors of these banks which went under and have been carried on the taxpayer’s bill. In the same breath they say our contracts are no longer valid and that is not on. Simple as that.”

“Ministers talk in the media about these wonderful offers which will not be repeated but as I understand it they have yet to be tabled at the negotiations. They are being duplicitous about what they say in public and what they are doing in the meetings, though I have to say I did not trust the last Government either.”

“Britain in the 21st Century Britain is ruled by a 19th Century style elite.  This is an ultra-conservative Government, they are very much interested in revitalising a class system where people know their place. It is a very strange situation where we have a very strange bunch in charge and I hope we get rid of them as soon as possible.”

‘K’ works for the Department for Work and Pensions but has asked us not to publish his name.

“Frankly no-one in this country, public or private sector, believe we are all in this together. The bankers who caused this problem, who appear to be friends of our leaders do not seem to suffer any sanctions for this at all. The bank levy is tiny and they will find a way around it, everybody knows that. It is disingenuous and unfair. When you add all this together is it surprising there is a good deal of bitterness around?”

“Someone in a senior position like I am, in charge of around 20,000 people, is on £75,000 a year. If I had been working for a private sector company being in charge of so many people I would have probably doubled that. But my salary was held down and that was supposed to pay for my pension.”

Sasha Elliot is a primary school teacher from Camden and membership secretary for the local National Union of Teachers chapter.

“The Government usually carries out independent valuation of the schemes every four years. It is refusing to do the one due now because it knows it will prove it is perfectly sustainable. The truth is, it is quite handy to rob them. The NUT estimate that since 1923, when the teachers pension scheme started, that £46bn has been paid in that has not been paid out, so it is quite clearly a profitable cash-cow.”

She says removing pensions is part of efforts by Education Secretary Michael Gove to fully privatise the education system using the free school and academy programmes.

“Things like teacher’s pensions are a bar to that, and this is a really good way to dismantle it. As the pension contributions go up in four years time you will have teachers starting with 40k of debt. Obviously lots will opt-out and when no-one is paying into them anymore that will make them unsustainable.”

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Comments

There are 22 comments at the moment, we would love to hear your opinion too.

  1. I have some sympathy for changes made to any contract which leaves the person worse off. However, this has happened across the board and is not targeted at the public sector. For example the old age pension will be paid later and for those who have made no provision, for whatever reason, this means working longer. This is more likely to hit the lower paid and those who are, probably, doing more manual jobs more.

    It is unfair to blame all the problems on bankers. Yes there have been significant issues but where were the regulators? Not all banks took tax payers money either so let’s not put everyone in the same camp.

    In essence we as a country and as individuals have been spending more than we can afford afford to pay.

    Is it fair to ask those who have no pension provision, or a lower pension provision, to increase their taxes to pay a larger pension to those in the public sector who could pay more toward their own retirement?

    We have to be realistic, when there is no money you have to make cuts.

  2. “Bankers caused the problem”???

    Shows how ignorant and selfish these people are, we couldn’t afford their chuffing pensions 20 years ago!!!

    Must calm down, perhaps Clarkson was right, we should put them out of our misery.

    BTW, sums up the chumps at the MoJ.

  3. It is nonsense to say that those in the public sector get paid less than those in the private sector and that their pension entitlement makes up for that. I would guess there are very few people that go into any employment because of the pension benefits available, and those that do should seriously think about living in the present. Yes, there are some public sector workers that work very hard, but in my experience there is a higher proportion that have never lived in the real world, and spend their lives faffing about dreaming up nonsense for the rest of us to comply with,

  4. The public sector workers in Wales were so outraged that most of them went shopping to Cardiff on Wednesday for retail therapy. The shops said they had never had such a busy day. No sympathy here I’m afraid if they can afford to lose a day’s pay and treat the day like a holiday.

  5. @ Anonymous | 2 Dec 2011 2:08 pm…Unfortunately realism is not part of the vocabulary of either Politicians or Union Leaders. Politicians acted irresponsibly to buy votes, Union leaders are simply lining their own pockets at members expense. They’re as bad as each other.

  6. ” Fair Pay for All” say their banners but only if you are in the public sector it should say in brackets. Why do seemingly intelligent people get led by the nose, they should read and digest the terms of the offer rather than believe what the Union tells them it means.

  7. Massive load of cobblers. The levels of pension provision in most private sector jobs will just about cover the Council Tax bill for retirees. Some coffee smelling is needed.

  8. I’m with Clarkson on this one.

  9. If they are not happy with their pay & pensions and are envious of the private sector, they can always resign and come to our Utopia. If you reckon you can double your money in the private sector, you’d be an idiot not to do it…?

    It’s very easy to blame everything on the bankers, but the last government must shoulder a lot of the blame.

    Teachers in particular should be putting all their efforts into educating our children properly, it is our children who will be paying their gold-plated pensions while being unable to afford their own.

    And there weren’t any teachers on a picket line round here, they were doing their Christmas shopping. And they’ve got a “training day” today – and then they break up for their 2 1/2 weeks holiday on the 16th. Poor old teachers.

  10. David Brookes | 2 Dec 2011 2:50 pm

    ” Fair Pay for All” say their banners but only if you are in the public sector it should say in brackets. Why do seemingly intelligent people get led by the nose, they should read and digest the terms of the offer rather than believe what the Union tells them it means.

    ——

    So true!

    Also interesteing to note that many union leaders have a six figure salary and an average annual pension contribution in the £20,000 range (yes that is per annum).

    I also had to laugh at the teachers with the “no cuts” banners with a no symbol over it. So they are supporting the cuts!?

  11. Its all the bankers ? They really do believe all this stuff.
    Were the bankers stupid in what they did ? Did the politicians blame the bankers to deflect the balme from failed regulation ? Has the country been over spending for years via public finances ? Have we lived beyond our means on credit cards and loans for years ? Has life expectancy been going up for years and thus the costs of pensions ?

    I suggest the answers to the above are all – YES

    Money spend on the banks was a drop in the ocean. The party was going to end sometime and something was going to trigger it off.

    As Hugh Hendry said – you didnt like bankers when they would not give you money, then they gave you money and you liked them, now they wont give you money again. Get over it.

  12. Dermot Brannigan 2nd December 2011 at 3:54 pm

    You’re spot on, Rich.

    You only have to look at a graph of the UK debt increasing since ’98 to be able to work out where that money has gone – the public sector.

    Things were fine as long as the money was there for the repayments on that debt. That source has dried up, but the repayments haven’t. Had the debt not been created, we wouldn’t have trouble with the repayments.

    All the private sector is asking is that you keep your pensions, but just shoulder more of the burden for paying for them.

  13. Surely the “sensible” thing to do would be to negotiate something that can be afforded now with a guarantee of a reveriew when the UK gets back on its feet.
    Continued strike action will simply create more debt and entrenched positions and with the majority of the country struggling under the weight of debt created by previous generations creating more from nothing is only something found in the Bible!
    For me it is interesting timing for strike action – do the Union leaders need overtime, do the workers need time off or is this simply politics of the lwest kind.
    Go back to work and negotiate the best deal that the country can afford at this time – and for crying out loud use a good dose or reality in doing so!

  14. How many people would leave the pension if the changes happen? Our family could not afford the change. We have 3 small children my husband is a very well qualified teacher. I have chosen to stay at home to raise our children as I think this is very important, but we need every penny we get and we just manage, but if we have to pay an extra £100 that will break us and we would just have to opt out.

  15. Direct extract from Labour Market Statistics Bulletin
    Northern Ireland Annual Survey of Hours and Earnings 2011 23 November 2011
    A NATIONAL STATISTICS PUBLICATION

    • For full-time NI employees, median weekly
    earnings in the public sector were 41.5%
    higher than in the private sector at April 2011,
    and this was true for both men (39.6% higher)
    and women (64.7% higher). In the UK, the
    equivalent median full-time earnings was
    16.7% higher in the public sector than in the
    private sector.

    If you look back to 1997, you will see a very different picture. The statistices don’t even take in to account the fact I suspect there are overtime bans for many public sector workers, while the private sector works as many hours as they can to get the money they need. There is little or no sick pay for much of the private sector and benefits have been cut to the bone.

  16. Yes of course it’s the bankers fault the public sector pension scheme is in a mess. Nothing at all to do with the public sector having earnings 25% higher than the private sector, people living longer, insufficient personal contributions which have to be supplemented by the tax payer, public sector individs retiring early and us having to pay final salary pension payments to high salaried individuals for longer – final salary?yes remember, those gold plated pension schemes that existed years ago that the private sector had to close when they realised they couldn’t afford to fund them. Public sector workers and unions really need to understand the fundamentals before they shout about their hardship and who’s at fault but I really don’t think they have clue! Come over to the private sector – come over to the banks, you’ll love the hours they work! I understand they didn’t “sign up” for this, but neither did any of us.

  17. When I first took out a personal pension all dividends were received by my fund tax free.

    Gordon then changed the rules and begun taxing private pension funds to the tune of over £ 5 billion a year.

    I wasn’t consulted, I don’t recall anything in New Labour’s manifesto, No Public Sector Unions cried out in support of their private sector brothers pensions.

    On a smaller scale when I first took out a personal pension the Govt said I could access this at age 50. Then along came Gordon who changed the contract yet again by saying I couldn’t have it until 55.

    And its not just Gordon. This April the Coalition changed the contract yet again, this time for those drawing their income. The maximum withdrawal from drawdown personal pensions was reduced to 100% GAD down from 120% GAD.

    Yes small changes but they highlights that the Govt has constantly changed their contract with personal pension holders.

    Make all Public Sector final salary pensions paid up to protect past service and place them all into NEST for future service.

  18. @Caroline mcivor | 4 Dec 2011 11:53 am

    You should find the money because it is the best investment you can ever make, it is tax deductible so cancel Sky, your mobile contract, your holidays…

    In fact, get an IFA to take a look at where all the money goes.

    You might also like to try to live on what the lady at the supermarket checkout earns and compare the terms of your pensions schemes if she has one.

  19. I think we should all take a step back and think about this then complain like hell to the FSA.
    All of the trade unions involved do not have any FSA authorisation to advise members of the general public on financial or pensions advice. How can these people get away with general comments on the public sector pensions when people like my wife (NHS 23 years) has taken proper financial advice from a regulated IFA. My wife is ok with the arrangements after the details were explained correctly.
    It is time to start complaining to the FSA that trade uinons are crossing into our line of work and are not qualified or regulated.
    I’m sure the unions would be the first to cry to the TUC if we started advising on there rights to union members

  20. Surely, one of the most monumentally expensive things that should be top of the government’s agenda when reforming public sector pensions is all these phoney redundancy early retirement deals with a lavishly enhanced pension followed by a one or two month break before the lucky recipient is invited back on a “consultancy” basis, being paid even more than prior to retirement. The cost to the public purse of such deals must be mind boggling, yet these people think it’s perfectly okay just because “that’s what the rules say”. Very obviously, the rules need to be changed.

    An acquaintance of mine who worked in the PR department for the MoD (really valuable for national security, that job) and was made redundant at the age of 53. Not only did they give him the seven years he would have worked to the age of 60, but they started to pay it immediately with no reduction ~ plus his redundancy lump sum, of course. No private sector scheme would have just given him his unworked seven years, let alone started paying him his full pension immediately without reduction. A private sector scheme would allowed him strictly years to date and would have reduced his pension by half a percent for each month of early commencement and told him that if he didn’t like it, he’d have to make the best of his redundancy payment and try to find another job to see him through to age 60. And 60 is a generous NRA anyway.

    And why do the police get a full pension after just 30 years service, possibly from as early an age as just 48? An invitation to return to work on a “consultancy” basis often follows. Why isn’t their NRA 60 or 65 like the rest of us?

    A few years back I visited an army doctor aged 60 ~ in receipt of his full pension but still working on a salary of £80,000 p.a. Then there was the retired MoD procurement negotiator, who’d been granted an early retirement pension of £70,000 p.a. (plus 3 x pension lump sum plus redundancy payment), worked on as a consultant for a further 8 years and had amassed a portfolio of savings and investments worth £1.35m. Oh, he said, I don’t want any of it going to the tax man when I die. I very nearly said: Why not? That’s where it all came from.

    These people just have NO IDEA of the real world and they’re the absolute worst when it comes to paying a fee for advice.

    Bring it on, I say.

  21. Our local council thought it would be a good idea to switch off 50% of the county’s street lighting altogther. When I wrote to the Council to object following an accident involving poor lighting I was advised by a council worker that I should consider the greater good of the community since the savings had been made to allow other services to continue.
    Perhaps these same striking workers should take their own advice and consider the interests of the greater community.

  22. And another thing ~ in the wake of so many private sector employers diluting the accrual rates under their DB schemes, raising employee contribution rates and/or switching the schemes to DC, how many of those workforces did we see going on strike? None that I can recall. The members simply accepted ~ had to accept ~ that times change and that the retirement benefit arrangements their employers had established in all good faith many years before have simply become unaffordable.

    In one letter to employees that I saw, the company stated that maintaining its current pension provisions could threaten the very survival of the company itself. The members of all those private sector schemes could have gone on strike, but how would that have changed the fundamental realities of the situation? They realised that it wouldn’t and therefore didn’t. On what basis do public sector workers, as they always seem to, consider themselves to be exempt from such realities?

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