A declaration of belligerence


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Today (3oth June) is strike day. It is a general strike by a proportion of society that has seen total personal reward for its labours massively increase over the past fifteen years. The people who will be suffering are members of the private sector for whom total reward has probably remained static over the past 10 years and has certainly not kept pace with that of those who are striking.

I can think of no other instance in history where the upholders of social equality– the Unions are striking top maintain social inequality. This is not so much a strike but a declaration of belligerence.

I have written repeatedly that this strike is inevitable , necessary and ultimately futile.

Clearly we (the taxpayer) can afford to continue to pay final salary benefits to teachers, doctors, firemen, local government officers et al.

The question is not whether these pensions are affordable – the taxpayer can afford more or less what they like unless they are Greek (but then they generally don’t pay tax).

The question is whether one half of the tax-payers- the private sector , are prepared to pay those in public services not just equivalent salaries but vastly superior pensions.

The answer seems to be “they are not”. The strike is necessary not just to demonstrate to those who have the benefit of gold-plated pensions, the value of what they have – but also to alert the rest of us to the fact that most of us are now paying more for other people’s retirements than we are spending on our own.

It is necessary to have a strike to demonstrate just how gold-plated these gold-plated pensions are. The oft quoted figure that the average pension being paid out of Local Government Schemes is £4,500 pa might suggest the opposite but when you think that it costs an individual to provide an equivalent benefit for themselves around £120,000, then it becomes clear that what might appear nugatory is, relative to what private sector schemes are producing, pretty damned good. I would hazard a guess that the average pension arising out of the private sector this year will be less than 50% of this amount.

It is also necessary to have a strike to educate all parties about how pensions work. I heard this morning a representative of the NUT complaining that because the Government were two years late in publishing a valuation of the Teacher’s Pension Scheme she had no way of assessing its deficit and was therefore denied the right to properly negotiate on behalf of her staff.

This demonstrates a staggering incompetence. The valuation will not show that the Teacher’s scheme is in deficit this is because the Teacher’s Scheme is not funded – benefits are paid from general taxation. There is no defect nor will there ever be a defect on the Teacher’s Scheme. While it’s understandable for her member’s to be under this misapprehension, it is inexcusable for her to ber representing her staff without understanding the pensions they are striking over.

Untill we have a better understanding of these pensions we all have – whether state, occupational or personal, we will continue to have declarations of belligerence such as what we are seeing today. However, because of the strike, we now have the opportunity to engage with pensions and hopefully with issues of fairness surrounding “total reward”.

As has been pointed out many times, the public sector has been allowed to become the privileged party to a pensions apartheid that is ruinous to the good running of a society priding itself on social inequality. The unions, and I am a union man, should understand this and not just snort belligerence. They will emerge from this strike with little glory and will hopefully turn their attentions to fighting other fights –  fights that they can and should win.

This is not one of them,

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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2 Responses to A declaration of belligerence

  1. Pingback: A declaration of belligerence | 333pension

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