Many UCU members have expressed surprise at the apparent short notice of the strike action on May 10. I am reproducing here part of the UCU newsletter issued by the UCU branch at Northumbria University with all credit to them for their excellent contribution.
“FOR ALL UCU MEMBERS AT NORTHUMBRIA – REPS PLEASE FORWARD
PENSIONS STRIKE DAY THURSDAY 10 MAY
Dear Colleague
Some members have been expressing anxiety about the National Executive Committee’s call for strike action next Thursday, May 10, over the government’s changes to the Teachers’ Pension Scheme (TPS). Others consider the call is long overdue.
There may be a case to be made about timing, and also about the non-involvement of the major TPS stakeholders, the NUT and NASUWT, on the day. There has also been little work done on the ground by the union, among members and the general public, as a build-up to this. We can do nothing about the first point, but this Newsletter is intended to go some way towards rectifying the latter, at least among members.
In the first place, the issue has not gone away. And it’s not about ’affordability’ or ‘debt reduction’ on the government’s part. Just read what Treasury Secretary Danny Alexander said, explaining the government’s public-sector pensions policy to Parliament last December:
“The new pensions will be substantially more affordable to alternative providers. We are no longer requiring private, voluntary and social enterprise providers to take on the risks of defined benefit that deter many (from) bidding for contracts in the first place.”
So the pensions policy is actually about privatisation. In order to sell off services to the private sector, the government has to reduce the cost of pensions to potential private employers, and abolish national pay rates, with regional pay as a starting point. This isn’t just something happening in local government. The plan is to bring it in to the school sector and universities and colleges as well. That much is clear from recent documents published by Universities UK and the 157 Group in FE. The government is being lobbied hard by private providers and private equity firms to remove ‘barriers’ to their investment in the sector. So, when we fight to maintain the value of the pension we are also fighting to keep our service free from privatisation.
Secondly, members voted decisively in a consultative ballot, less than 2 months ago, to reject the government’s “final offer” and to keep up the strike action to defend our pensions, provided other unions were taking action at the same time. Next Thursday will see the biggest turn-out since November 30, as members of civil servants’ union PCS and Unite members in the National Health Service stop work. Like it or not, the UCU NEC has a democratic mandate for the strike call.
Third, UCU members in London have already taken strike action in line with that ballot, in conjunction with London NUT on March 28. That was a highly successful turn-out, and we have a responsibility to show our colleagues there that they are not alone.
Fourth, the increased TPS contributions which we have all had deducted from the April pay are only the start. This year, contributions have increased from 6.4% for everyone to 7.6-8.0% for the majority of members, although those on the lowest salary levels have smaller increases while at the top end (more than £75K) deductions are higher. If the net pay reduction wasn’t as much as you expected, then that’s probably because of the increased personal tax allowance from the Budget, but effectively you have still had a pay cut. In the next 3 years contributions will increase again, so that from 2015 they will average 9.6%.
Fifth, there is also the matter of the increasing retirement age. The revised TPS is going to be linked to the State Pension Age. On the Department for Education web site, that is given as rising to 66 by 2020, 67 between 2026 and 2029 and to 68 between 2044 and 2046. If you retire earlier, you’ll get a reduced pension. But in the Budget George Osborne stated:
“I can confirm today that there will be an automatic review of the state pension age to ensure it keeps pace with increases in longevity.”
That’s the sting in the tail! Independent financial analysts at Standard Life estimate that a 37-year old would have to work until they are 70, a 21-year old until they are 75 and a person born this year work until they are 80 to get their state pension – so the TPS Normal Pension Age (NPA) will rise at the same rate.
Members who are within 10 years of NPA (60 if joined before 1 January 2007, 65 from then) are protected from the new scheme changes, except for pension increases. Members who are 10-13.5 years away from NPA will remain in the existing scheme for a limited period after 2015 before joining the new scheme. All others will start in the new scheme from 2015. So the last two categories will essentially have a pension in two parts, but any new starters from 2015 will have no offset from the much inferior benefits.
You can work out what you will lose, in pension pay-outs and increased contributions, from the union’s TPS pension loss calculator at http://www.ucu.org.uk/tps60losses . But here is an example for a Senior Lecturer, aged 40, with 7 years’ membership of the scheme:
Years left to work: 27 years (at current estimate of NPA)
Higher contributions: £102 per month
Pension loss over 25 years of retirement: £186,000
Those of us who are protected have achieved that outcome as a result of the hard efforts of those who went before us, and also as a resukt of the action taken in March 24, June and November last year. We owe it to our younger colleagues to ensure that they are as well protected as we are.
So there is every reason to take strike action on May 10. “
