Local government pension proposals anger unions

Council care workers should be given the choice of paying more into their pensions or contributing what they do now and receiving less when they retire, the Local Government Group has said

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Council care workers should be given the choice of paying more into their pensions or contributing what they do now and receiving less when they retire, the Local Government Group has said.

In a letter to Eric Pickles, secretary of state for communities and local government, the employers’ body submitted proposals on how to make the required 3.2% savings from the Local Government Pension Scheme.

The LGG proposed:

• No increase in employee contributions for staff earning less than £15,000, a 1.5% increase for those earning between £15,000 and £21,000 and an increase of between 2% and 2.5% for those earning over £21,000.

• Giving those who feel they cannot afford an increase in contributions the option of taking a reduced pension accrual rate.

• Raising the normal pension age from 65 to 66 from April 2014, but only for benefits built up from April 2014. Benefits built up prior to then would retain a normal pension age of 65.

However, Unison insisted today that it could not sign up to the proposals.

Heather Wakefield, Unison’s national secretary for local government, said: “We have told the LGG and the employers that we cannot sign up to these plans, which raise nothing more than a £900m ‘tax’ on LGPS members.”

“Our members in the LGPS are facing attacks on their pay and conditions everywhere, local government pay has been frozen for two years and inflation is going through the roof. Increases in pension costs are the final straw.”

Unison has announced that it will ballot more than 1.1 million of its members in local government and health over ministers’ plans to make them pay more into their pensions.

If their members back a series of national strikes, to take place from this winter and into next year, it will be the biggest collective industrial action since the general strike of 1926.

Sir Merrick Cockell, chairman of the Local Government Association, said: “It is unfortunate that we have not been able to reach an agreement with the unions so far, but we hope constructive talks will continue.

“Our approach is in line with the recommendations of the Hutton Report, and is fair to staff and affordable for the taxpayer. Importantly, the approach represents a considerable improvement for local government employees on the original offer from government, with no increase in staff contribution for the lowest paid and a significantly lower rate for others.”

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