The government has been warned that implementing radical changes to public sector pensions could “light the blue touch paper” for strikes by millions of workers.
Labour peer Lord Hutton sparked anger after recommending to ministers that public sector workers should be stripped of their final salary pensions and instead have schemes linked to average earnings, while paying more and working longer.
Unions representing council workers, NHS staff, civil servants and other public sector employees reacted with fury to the report and warned of co-ordinated industrial action.
Jon Skewes of the Royal College of Midwives said members would be “appalled” by the government’s “attack” on their pensions.
“On top of pay freezes, cuts to services and threats to the NHS itself, this will be seen as a slap in the face for hard-pressed midwives and maternity support workers. They will react with anger and dismay and many may vote with their feet and leave the NHS. This will only serve to exacerbate the current and critical shortage of midwives and have a negative effect on the care women and babies receive,” he warned.
Dave Prentis, general secretary of Unison, said the government was treating Lord Hutton’s report with “contempt” and had already decided to increase pension contributions.
“On top of a pay freeze, and the threat of redundancy, they now face a pensions raid. This brings the threat of industrial action closer,” he warned.
TUC general secretary Brendan Barber said: “Public sector workers are already suffering a wage freeze, job losses and high inflation. They are now desperately worried that they will no longer be able to afford their pension contributions, and will have to opt out.
“Even without any changes recommended in today’s report, public sector pensions have been reduced in value by 25% by a mix of negotiated change and the government’s arbitrary switch to the CPI measure of inflation.
“On top of this the government has announced a £2.8 billion increase in contributions and a review of the discount rate that could also increase contributions. Even without further changes public sector workers will pay much more for substantially less.”
Royal College of Nursing chief executive and general secretary Peter Carter said: “There’s no doubt that these proposed changes are another hammer blow to the morale of dedicated nurses. NHS staff are not only facing a two pay freeze and widespread cuts to jobs and services, but now they will pay more, work longer and yet receive far less than expected in their hard-earned pensions.
“We know the strength of feeling among members and will vigorously defend fair pensions for nurses and healthcare assistants at all times. It is our belief that the current NHS pension scheme is fit for purpose.
“There is a risk under this proposal that there may be an exodus of hard-working staff before the normal pension age is increased to 65. These departures would have a significant effect on patient services and those NHS staff left behind to deliver patient care.”
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