GMB and UNISON accuse pressure group of manipulating pension figures

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Unions today call on the Taxpayers’ Alliance to get its facts straight on local government pensions.

The low tax pressure group is once again attacking the local government pension scheme that allows low paid public service workers to save for their retirement. It is wrongly arguing that £1 in every £5 of council tax goes towards local government pensions.

The actual figure is just 5p in every £1 paid in council tax, because council tax makes up just 25% of a council’s overall funding. The remaining 75% comes from other sources such as business rates and central government funding.

The group also misses the point of pensions when it manipulates the figures to claim that the local government pension scheme faces a ‘black hole’. In comparing liabilities to assets, it is deliberately making a ridiculous assumption that everyone will retire on the same day.

UNISON’s head of local government Heather Wakefield said: “The so-called Taxpayers’ Alliance should stop attacking the pension rights of low paid public service workers such as dinner ladies and bin men, and concentrate on getting its facts straight.

“Back in reality, the local government pension scheme is a sustainable and affordable way of helping low paid workers to save for their retirement. Without the scheme, the taxpayer would be left holding a multi billion pound means tested benefits bill.

“It is pure fantasy to claim that there is a ‘black hole’ as if everyone in the scheme will retire on the same day.  Any actuary worth their salt will confirm that with pensions it is vital to take a long-term view.

“Let’s not forget that the average pension in local government is not at all gold plated. It is just £4,000 a year, dropping to just £2,600 for women.”

GMB national pensions officer Naomi Cooke said: “Knee-jerk reactions to big numbers are not the way to reform a sound, viable pension scheme. Saving arrangements for retirement need to be encouraged not condemned.  Making rash recommendations for pension cuts with no assessment of consequences as has happened across the private sector is to the ultimate detriment of taxpayers who end up footing the entire bill to cover people’s retirement.

“Evidence based negotiations are currently underway as unions and employers work towards a reform package for the LGPS which, unlike TPA’s approach, will support a sustainable LGPS for generations to come.

“The cuts advocated by the TPA would throw council budgets into chaos, decimate the scheme and result in higher council tax bills for everyone as the new money into the scheme dried up.  Closing good schemes and pricing members out of pension saving does not save money in the long term; sensible, measured reform is the only way forward for members, taxpayers and the economy.”

* The TPA is not averse to getting facts wrong, as Carl Roper shows here  

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