the pensions battleground
WORKERS, APR 2005 ISSUE
In response to the attack on their pensions, local government workers and civil servants, including Crown prosecutors, government lawyers and special advisers had been set to join school dinner ladies and refuse collectors on 23 March in a one-day walk out — one of the biggest since the General Strike of 1926 — against the government's attack on pensions. Ballots for action produced results of between 73 and 83% in support.
Comments from workers such as "It's really important to get this message to national government that we're not going to let them do this to us", illustrate the depth of unity and show the British working class at its very best. A UNISON member sums up the position: "Many members are relatively low paid but the reason they continue to serve in the public sector is at least partly because they have had the promise of a decent pension at the end of it".
This is a wages fight despite the government's attempt to hide behind nonsense. The dead hand of the European Union also should not be overlooked. Rather than break EU guidelines, the government has attacked the "final salary" pensions promise. The empty slogan of "only borrowing to invest" is a play on words to mask the EU dictat that Britain's borrowing must not exceed 3% of GDP. This imposed constraint has one purpose, to deliver an ongoing attack on workers' living standards, pushing us back politically and economically. The downgrading of pensions is a vital part of this attack.
The so-called crisis is government- and EU-sponsored to rid Britain of its collective pensions approach. The lie put about is that pension costs have spiralled because we are living longer. In fact, today's mortality rates show a modest improvement. Men born between 1925 and 1945 (today's 60- to 80-year-olds) are likely to live 11 months longer than previous expectations. This improvement is then projected forward and multiplied at the same rate to apply to the years from 2030 to 2035, producing the fiction that by then we will all be living to between 95 and 100. The years 2030 to 2035 are chosen to try to make the position look even worse because these years represent the "pensioner peak" caused by the post-WW2 baby boom.
In fact, the problem has nothing to do with longevity or dependency ratios and everything to do with Britain's de-industrialisation, where less wealth is now created to pay for pensions, compared with the 60s. To put this "crisis" into further perspective, a leading pensions annuity provider, when factoring in the "11-month mortality improvement", reduced its company net embedded value by £160 to £180 million, the equivalent reduction of less than 3p on its share price — big deal!
Reaching old age is something that happens to us all. A senior civil servant has put it thus: "We are sometimes encouraged to look on the elderly as a rather tiresome burden on the wealth creators. But that is to ignore the moral claim the elderly are entitled to make on those in work. They, after all, created the stock of physical assets, the factories, the roads, the houses, the schools and so on which their children use to generate their own incomes. The claim of the retired is the legitimate claim of those who have collectively saved out of past income, not in any narrow financial sense, but by forgoing consumption when they were at work." It is this civilised approach that is being attacked, and at long last we are showing that we are up for the fight.