Two days before the largest strike in a generation, I addressed a packed hall of trade union members in Glasgow. They were united and determined to resist this government’s raid on their pensions – and that was before they’d heard George Osborne’s autumn statement.
Perhaps one prescient member had been given a sneak preview, since she told me: “If we don’t stand up for pensions today, they’ll come for our pay or our jobs tomorrow.”
Public-sector workers face working longer and paying more to get a smaller pension, despite their existing arrangements being entirely affordable and sustainable. The proposed increase in pension contributions is a tax on working in the public sector – all going to the Treasury, not a penny towards improving pensions. It’s robbery.
Workers are in the second year of a pay freeze – years that have coincided with rampant inflation. They now face two further years of below-inflation pay rises, at the end of which their living standards will be 15 to 20 per cent lower.
The government replies that many private-sector workers have suffered pay freezes and lost their pensions. My union has nearly 30,000 private-sector members, but we’ve never argued for an equality of misery. The government would like us to compare public- and private-sector workers in some sort of depraved competition for the worst lot, to distract us from the vast gap between what is imposed on ordinary workers and how a tiny elite at the top carries on.
The differences between public and private are overplayed: the average public-sector pension is £5,600, while for private-sector workers in defined benefit schemes the average is £5,800 – roughly the same modest amount. But while 85 per cent of public-sector workers are in defined benefit schemes, only 11 per cent of private-sector workers are.
Wilful greed
That scandalously low figure in the private sector is a result of the wilful greed of top directors, who have closed pension schemes while protecting their own nest eggs. These directors have an average pension of £175,000 per year and last year their pay increased by 49 per cent, on average.
All of us pay for that private-sector greed through higher prices in the shops, higher bills, higher fares and by missing out on tax revenues as many wealthy individuals and big business hide their money away offshore – an option not available to ordinary taxpayers – but which costs us all £120bn a year in lost revenues.
This cosseted elite, including many of the current Cabinet, have never had to worry about paying the bills, going into arrears on their rent or mortgage, or even having to choose – as many pensioners will this winter – between adequately heating or eating.
The day before the strike, the Office for Budget Responsibility (OBR) estimated that public-sector employment will fall by 710,000. In the past three months alone, civil servants have seen 24,000 of their fellow workers leave. This is damaging public services from borders to tax collection. Even in the so-called “protected” areas, such as the NHS, 26,000 staff have been forced out in the past quarter.
With falling living standards, the prospect of an impoverished retirement and their own jobs increasingly under threat, public-sector workers are understandably angry. As in any confrontation, some have wanted to keep their heads down and hope it doesn’t affect them but there is an increasing realisation that we need to unite and stand up to this bullying government.
On picket lines and in marches and rallies across the country, that is being demonstrated. If the government does not change course and start meeting the needs of ordinary people, more and escalating strike action, occupations and protests will be inevitable in 2012.
Growth strategy
A BBC opinion poll just before the strike showed 61 per cent thought it was justified, while only 36 per cent disagreed. Why should that be? There is a growing awareness that the wrong people are being made to pay for a crisis they had no role in creating. That same poll showed only 28 per cent believed the government is handling the economy well; 67 per cent disagreed.
People are rightly asking why the government is slashing over £20bn from welfare and imposing £9,000 fees on students, when it can afford to give away £25bn in business tax breaks? Why public-sector pensions are now unaffordable yet nuclear weapons a necessity? Why young people get six months in jail for stealing bottled water, while big business can avoid paying billions in taxes with impunity?
There is a creeping sense of injustice and a realisation that the government is on the side of its fellow millionaires. But there’s also something positive going on: solidarity – a further awareness that, underneath the millionaire cabinet and its City friends, we are all in this together.
Mark Serwotka is general secretary of the Public and Commercial Services Union
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