Championing Public Sector Pensions

Contents

Links below lead to the appropriate section of the page

• Pensions Latest
• Contact your MP online
• Attack on public sector pensions
• The Independent Review of public service pensions
• Protecting public sector pensions

The occupational pension schemes for teachers in England and Wales, Scotland and Northern Ireland represent one of the most important and valuable elements of the teachers’ remuneration package. A summary of the main benefits that the schemes provide can be found in the NASUWT leaflet Protecting Your Pension.

Attack on public sector pensions

Public sector pension arrangements such as those for teachers and for local government employees have come under renewed attack in these difficult economic times. Some elements of the media, private industry and the major political parties are highly critical of public sector pensions for being ‘too generous’, 'too costly' and a ‘burden’ on the public purse i.e. on tax payers in general.

The Coalition Government have already announced significant changes to the way public service pensions will be increased to keep up with future inflation and to public service employees' pension contributions. 

The first change - in the index used to measure inflation for the annual revaluation of pensions - will have a dramatic effect on the level of your teacher's pension over time. You can find out what the change will mean for you in The Change from RPI to CPI. 

Then, without even waiting for the publication of Final Report of the Independent Public Service Pensions Commission, the Chancellor announced in October 2010 that employee contributions to public sector pensions would increase by 3% on average. This will  increase the level of teachers' pension contributions by half, to 9.5% of salary or more, from 2014/15.

The NASUWT believes that these attacks are based on a number of common myths and misunderstandings as to the true nature - and cost - of public sector pension arrangements and that public service workers get the occupational pensions that their service deserves. The TUC has produced a briefing for trade union members on these mistaken attacks entitled Exploding the myths (new window).

The NASUWT further believes that:

• public sector pensions are a substantial part of pension provision in the UK
• public sector pensions are deferred pay and make up a significant element of the negotiated remuneration package for five million public service workers, and
• public service employees make an appropriate financial contribution towards these pensions. 

The Independent Review of Public Service Pensions

The Coalition Government has established an Independent Public Service Pensions Commission with Lord Hutton as Chair to carry out a fundamental structural review of public service pension provision and make recommendations on arrangements that are "sustainable and affordable in the long term, fair to both the public service workforce and the taxpayer and consistent with the fiscal challenges ahead, while protecting accrued rights".

The NASUWT does not believe the Review of public service pensions is necessary, appropriate or independent. The NASUWT expects the Commission to resist the Coalition Government’s ideological antipathy toward the public sector; to rectify the misleading impressions around the costs and affordability of public service pensions; and dispel the myth that they are unsustainable, unaffordable and ‘gold-plated’ benefits for public servants. The NASUWT has submitted evidence to the Independent Public Service Pensions Commission to that effect.   

The Commission published its Final Report on 10 March 2011, containing recommendations for far-reaching changes to public sector pensions including a rise to age 65 in the normal pension age for existing teachers and significant changes to the method of calculating teachers' pensions for future service. The Commission's Interim and Final Reports can be found on The Independent Public Service Pensions Commission website (new window) and the NASUWT's evidence to the Commission can be found on the Union's Independent Public Service Pensions Commission page along with Union's own Commentary on the Commission Report Final Recommendations.

Protecting public sector pensions

It is worth remembering that significant changes to teachers' pensions were agreed from 1 January 2007 (and from April 2007 in Scotland and N Ireland) following months of negotiations between Government, employers, NASUWT and the other teacher unions. The agreed changes included an increase in the normal pension age (i.e. the age at which a teacher's pension can be drawn without any actuarial reduction) from 60 to 65 years for 'new' scheme members; arrangements for sharing future cost increases and an increase in the employees' contribution rate.  The NASUWT welcomed the agreements on changes to teachers' pensions, which it believes provide a fair and balanced solution to the challenges of meeting future costs while maintaining sustainable, quality retirement provision for both existing and future teachers.

A recent Report by the TUC entitled Decent Pensions For All looks at occupational pension provision and explains why public sector pension arrangements are affordable and why the real challenge is to reverse the collapse of private sector pension provisions. A copy of the TUC's analysis can be found at Decent Pensions for All (new window) and the NASUWT has produced a summary of the key points from Decent Pensions For All.

In fact, the Union believes that all workers, whether in the public or private sector, should have access to good occupational pension schemes providing similar benefits during retirement.

The NASUWT will continue to work with the TUC and other unions to resist attempts by others, including any future Government, to worsen pension provisions for teachers or other public sector workers.