Brendan Barber, General Secretary of the Trades Union Congress (TUC) has delivered his New Year’s message to union members calling for the pensions’ crisis to be addressed through compulsory saving with employers and employees and a guaranteed state retirement provision.
In his message, Barber called for pensions’ action, reminding members that it is an issue of relevance to every group within the workforce.
“Those who thought they had secured occupational pensions have been hit by stock market turmoil and the cumulative effect of long contributions holidays when investments were performing well. Some have even lost all their savings as their employers went bust. We welcome government moves to compensate those who have lost out, but we need to be vigilant in 2005 to make sure sufficient funds are made available.
“Many now work for companies who have abandoned good salary related schemes for new employees in favour of money purchase schemes with drastically reduced employer contributions.”
Of occupational pension schemes, Barber said they were only good for the few people that work for larger businesses that provide them.
“Smaller newer companies are much less likely to do so. Even the big companies have contracted out many jobs; so that people doing jobs that would have had a pension attached a generation ago don’t now get one.”
The problem doesn’t just stop with the public sector he added:
“Public sector workers, many of them low paid, now face big cuts in their pension. This is the same as cutting pay and conditions for a group who have often been paid less than equivalent workers elsewhere because of their pension arrangements. The public sector will not attract or keep good staff if pensions are cut. Public servants are understandably angry.”
Barber poured scorn on the means testing system which he said caused workers confusion:
“With so much means testing now built into the pensions system, it is very hard for many people to work out whether it is worth their while saving.”
Savings compulsion is the way forward, urged Barber, together with a guaranteed state pension, reformed to make it fairer for women and set high enough so that ‘everyone can confidently save knowing it will boost their pension, not be eaten up by means testing.’
On other issues, Barber applauded the government’s progress on childcare reforms but said that the childcare workforce needs to be better trained.
On skills he called for a boost to basic standards pointing to statistics which show that one in four of the workforce have problems with either reading or numeracy.
“We need a successful and productive economy to deliver the living standards and public services we expect. We will not be able to do this without a big extension of skills and training. Union members are more likely to be trained than non-members. It’s time to spread the learning culture we have built in union Britain to non-union Britain.”
The New Year’s message was rounded off with a call to government to continue investing in public services to make up for what Barber referred to as a ‘chronic’ lack of investment in public services.
“There is clear improvement in health, education and many other services that users can see. But the investment must continue, and any government must nurture and extend the public service ethos that motivates both front line and support staff in the public sector.”