You can’t tell me I’m part of the Union

We’ve had some meat on the bones of the Hutton proposals today with a statement from Treasury Minister Danny Alexander too. You can read my earlier thoughts on Hutton in my blog “Hutton Speaks…and Makes Sense” below. But despite this, the knee jerk reaction of the Public Sector unions is, to paraphrase the late Miriam Karlin’s character Paddy, “Everybody Out”

The Government have now guaranteed that despite scheme pension age rising from 60 to 66 to logically coincide with State pension age rises – and dare I say it, most private sector pension arrangements – low paid public sector workers on less than £15000 will not have to pay contribution increases and those earning less than £18,000 will have a capped contribution rate of only 1.5%. Obviously, all benefits earned up to the date of any change will also be unaffected.

My very clever actuarial friends also assure me that many of the lowest paid – and those likely to remain so, will in fact probably be BETTER off under the Career Average model than under the old Final Salary scheme which tends to favour high earners or those with a steep career progression. Reform is clearly needed – that much is obvious, at least to most of us who have a memory longer than that of a flea and who remember the ‘Dear Chancellor – there’s no money left’ note from the previous administration as they walked out the door. So are the unions deliberately misleading their members to ferment discord or are they just badly advised? You tell me…