Thursday, 15 September 2011

A slow hand-clap for the TUC on pensions

I noticed the TUC now seems to be a big meeting in the office training room rather than a mass movement.

I also notice they seem to be being incredibly out of touch with what they are saying about public sector pensions.  From what I saw on the news yesterday I thought they were coming up with some incredibly undiscerning and unintelligent commentary on this issue.

Public sector pensions have to change. I've previously written about that here and here. In common with pensions in the private sector they have become incredibly more expensive to run than in the 50s and 60s.  This is because we are all living much longer.  Final salary pensions, with the levels of guarantee they offer, demand an open ended commitment - they are a bottomless pit and can be quite literally the running sore that destroys a business - just ask the car workers of Detroit.

In the private sector a business can only provide what it has got funds for.  It is not a bottomless pit!  Now, while economic reality is one step removed in the public sector it is still a reality.  In may ways the public sector watches what it spends very very carefully, but it is possible to misjudge either where more investment is required or where something needs to change.  And the public sector can only afford what the country as a whole can afford or can raise through taxation.     

The fact is we probably all need to work just a little longer and save a little more to provide realistic pensions. 

No, the TUC are missing an opportunity here.  We are all getting shafted on our pensions - public and private sector.  There needs to be change, but we need to safeguard employees so pensions reform makes the changes it needs to but adapts so we have a system that still provides good retirement incomes for all.
The TUC should be on the front foot suggesting how they should reform in their members' interests and leading reform of private sector pensions where they are pensions are being eroded away as even the biggest companies retreat from providing decent benefits.  Where in the private sector is using the demise of final salary pensions and the introduction of legislation to enforce the automatic enrolment of workers into a pension scheme to level employee benefits down to the lowest common denominator.

The TUC needs to be working constructively to adapt, develop alternative pensions models and then to defend workers rights and society accordingly.

Instead we get stereotypical caricatures of Red Robbo on the one hand and King Cnut on the other.

Slow hand-clap TUC!

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