C10 Defending quality pensions

Composite of motion 23 and amendments, and motions 24, 26, 27 and 28

Congress is committed to raising pension standards and fighting attacks on workers occupational pension rights whenever and wherever they may arise. Congress is appalled at attempts by politicians, the media, employers and the pensions industry to undermine workers’ savings.

Congress remains alarmed at the continuing decline in the access to and value of defined benefit pension schemes for millions of British workers, with more and more employers indicating that they are planning changes to their workplace pension schemes that will be to the detriment of workers across the country.

Congress recognises that public and private sector defined benefit schemes are both sustainable and necessary; and that the closure of public sector schemes threatens quality schemes in the private sector that are already scarce as a result of continual attacks on members’ deferred pay. Congress is extremely concerned for the future of final salary pension schemes in the private sector.

Millions of people are reliant on public sector pensions for their retirement income and now live in fear of their savings being decimated by a Tory government. Congress is concerned that risks of further attacks on hard-won pension benefits may take place after the next general election, with both the Conservative and Liberal Democrat parties already identifying this as a major area for cuts in the level of public expenditure. Such measures are likely to receive the enthusiastic backing of employer organisations like the Confederation of British Industry and extreme right wing organisations such as The Tax Payers’ Alliance who will do all they can to drive a wedge between workers in the public and private sectors. Congress calls on the General Council and affiliates to ensure that such a division is not allowed to develop and to campaign for good quality, affordable, defined benefit pensions for all workers in the run up to the next general election and beyond. Amongst other things, it needs to be made clear to members before the election what the impact of the main political parties’ policies will be on their occupational pensions so that they can take this into account when casting their votes.

Congress notes the coordinated campaign in 2005, involving ballots for industrial action, which successfully forced the Labour government to abandon plans to raise the pension age for workers in the public services.

Congress welcomes the TUC General Secretary’s analysis that companies are using the recession as in excuse to make savage cuts in pensions. In the context of the UK banks that have received billions of pounds of support from the taxpayer and in which the Government holds significant stakes, Congress will view any attack on pensions as part of the same short-term profit-seeking that precipitated the financial crash. Congress, therefore, calls on the Government to take positive steps to send a strong message to the part-publicly owned banks that the pension promises they have made to their loyal, long-serving and hard-working staff should be honoured.

Congress recognises that while current economic circumstances are challenging for schemes, pensions are long-term commitments; the sustainability of which should be judged over the economic cycle and against the long-term financial stability of the sponsoring employers. The lasting long-term effect of scheme closures on incomes in retirement could well have a devastating impact on individuals in old age, on overall direct and indirect economic demand in the UK economy, and on the public purse.

While Congress condemns those employers who are using current financial circumstances as an excuse to walk away from long-term pension commitments, Congress also acknowledges that the ability of many responsible employers to support defined benefit schemes has been compromised by the short-term effects of the financial crisis.

Practical and targeted action needs to be taken now to allow defined benefit schemes to weather the current financial crisis. A range of policies could provide real help. Different options, including instructing the Pensions Regulator to make more allowance for current conditions when agreeing recovery plans, agreeing a discount to the PPF levy, or revisiting the tax position of pension schemes could all assist organisations to keep defined benefit schemes open.

Congress resolves to adopt defence of defined benefit pensions, and improvement in defined contribution pensions as a key priority for the TUC for the next few years – one the movement must unite behind.

Congress calls on the General Council to:

i)        mount a properly resourced, coordinated campaign to promote and defend good quality defined benefit pension schemes

ii)      promote wider understanding of the critical role of occupational pension provision

iii)    build coalitions with organisations similarly committed to eradicating pensioner poverty

iv)    lobby all major political parties on the critical importance of maintaining existing occupational pension provision. The TUC must counter negative employer lobbying which exploits the current economic climate. It must also continue to rebut the argument that public sector provision should be levelled down to the standards increasingly seen in the private sector. Maintaining decent public sector provision is in the interests of all. The last thing Britain needs is a race to the bottom in pension provision

v)      lobby the Government and pensions regulators on the need to ensure that effective regulation is best achieved by balancing security in the short to medium term with the long-term sustainability of decent quality defined benefit provision.

vi)    show public sector schemes as a model of good practice to be replicated by employers, not to be cut to the minimum provision possible

vii)  publicly support the long-term sustainability of public services and public service pensions, recognising their significant contribution to the economy

viii)            take the necessary steps to ensure that all workers on public service contracts can participate in public sector pension schemes

ix)    highlight the savings to the taxpayer from occupational pension saving and the cost generated by inadequate provision and increased reliance on state benefits

x)      explain the contribution to the economy made by funded schemes which invest billions in UK businesses

xi)    work to introduce regulatory changes to bring in 50 per cent member nominated representatives and trustees on occupational pension schemes. Scheme members must have a decisive voice in governance and direction of investment

xii)  challenge the hypocrisy of the pensions industry and politicians seeking to force workers to work longer and save for their retirement but refusing to guarantee secure and reliable means of doing so

xiii)            organise a seminar by the end of the year on the various short-term measures that could assist in preventing defined benefit schemes from closing down

xiv)            invite a wide range of organisations to this seminar to ensure the widest range of options are considered and the broadest possible consensus supports any outcome

xv)  produce a report on the actions that are agreed would provide practical support in keeping defined benefit pension schemes open.

xvi)            support workers who are forced to take industrial action to defend their pension.

Mover:  GMB
Seconder:  Prospect

Supporters:  Accord, Transport Salaried Staffs’ Association, Connect, UNISON, Public and Commercial Services Union, Fire Brigades’ Union