New rules for civil servants’ pensions could push future retirees into a life in “poverty, it has been warned. The new Labour Party government could offer higher public worker salaries in exchange for pension plans which reward lesser returns.
But the National Education Union (NEC)’s secretary Daniel Kebede explained: “Public sector workers want to be rewarded fairly for the difficult job they do. They want fair pay and they want to defer some of their earnings so they can live a dignified retirement with a fair pension. The choice should not be poverty now or poverty in retirement.”
Cabinet office permanent secretary Cat Little said: “What’s the balance between pay and pensions? How do we really focus and segment our pay on the skills that we most need to recruit and retain within the civil service?
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“I think it’s really difficult to look at pay and reward in isolation. You’ve got to look at the whole operating model, which is why I’m spending a lot of my time on the operating model because you can’t just look at pay and reward without understanding what the benefit and the conditions to change pay would be.”
Richard Munn, Unite’s national officer for health, said: “This is nothing more than rearranging the deckchairs on the Titanic. The real issue is about providing more investment in public services. Lower pensions would force workers to work even longer, when too many are already being forced out of the health service before reaching pension age due to illness and ill health.”
Dr Vishal Sharma, the chair of the consultants committee at the British Medical Association (BMA), added: “Doctors’ pay has been eroded over the last decade by successive real terms pay cuts. The value of our pensions has also been severely reduced due to a combination of a reduction in pay, pension reforms and pension taxation. It would be neither fair nor reasonable to suggest that our loss in pay can be addressed by further raiding our pensions.”
A Cabinet Office spokesman said: “We are focused on supporting the civil service with the necessary tools it needs to deliver change for working people.”