Sunday 23 January 2011

PENSIONS - It's Official - this is robbery

Since the NUT Executive last met, more evidence has emerged of the threats to our pensions. On 7 January, the Department of Education wrote to the Union to say that the Chancellor wants to announce the proposed increases in our pensions contributions in the Budget on March 23rd. (UPDATE - they've agreed to postpone the decision until the summer).

So, before Lord Hutton has even issued his final pensions report - and without any valuation to justify these increases (see below) - the Con-Dems have already decided we’ll be paying more - much more - from our pay.

The letter says that proposed increases will be phased in over three years. But by 2014, the proportion of pay taken for pensions could go up from 6.4% to 9.8%.
Whatever your age or salary, this would be a big pay cut:
Inner London Salary             3.5% extra from your pay 
M1 = £27,000 p.a.         = £79 MONTHLY PAY CUT
M6 = £36,387 p.a.        = £106 MONTHLY PAY CUT
U1 = £41,497 p.a.         = £121 MONTHLY PAY CUT
U3 = £45,000 p.a.         = £131 MONTHLY PAY CUT

There’s no need for our pension contributions to go up.

That’s the clear message from statistics contained in a National Audit Office report published last month. The Report confirms that the changes agreed between Unions and the Government after our last campaign are “on course to deliver substantial savings”. In fact, the Government Actuary’s Dept. calculates those changes will cut the cost of public sector pensions by 14%. There is no justification for the proposed contribution hikes!

Of course, life expectancy has been increasing. That’s why one of the ‘savings’ previously agreed was that our contributions would go up from 6.0% to 6.4% in 2007. But this was based on a proper valuation of the scheme looking at all the relevant statistics. There has been NO new valuation made to justify what the Government is imposing. This is unjustified robbery. We have to stop it.

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