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Public Sector Pensions

Volume 537: debated on Wednesday 14 December 2011

10. What progress he has made in reaching agreement with trade unions on the Government’s proposed reforms to public sector pensions. (86429)

We have engaged in intensive and frequent discussions with the trade unions. At their request, talks are continuing at scheme level in the four public sector pension schemes that are currently being discussed, and we continue to make progress, I believe, in all four. We are determined that public sector pensions will remain among the very best available, but in order to make them sustainable and affordable for the long term, reform is urgently needed.

Under the Government’s offer, a teacher earning £32,000 a year could anticipate a pension of £20,000 a year, whereas a private sector worker earning the same salary would have to devote some 38% of his or her wages in order to get a pension of the same size. Given the terms of the Government’s offer, should the trade unions not now call off any threat of further industrial action?

I simply pray in aid what Lord Hutton, the former Labour Pensions Secretary, said yesterday, when he referred to public sector trade unions “holding a gun” to the taxpayer’s head. He said that the offer was generous and that it was hard

“to envisage a better offer being made.”

I hope that we can now move quickly to resolve the final, outstanding issues, so that we can move on without further disruption to people’s lives.

Given that the Minister’s Department is currently the worst in Whitehall for meeting the Government’s business plan targets—targets for which he is responsible—having missed 38 at the last count, would his time not be better spent sorting out his own Department, rather than picking fights with public sector unions?

The short answer is that we want to get these public sector pension issues resolved quickly. I would be quite interested to know whether the right hon. Gentleman shares our belief—and that of Lord Hutton, his former colleague—that we are talking about a generous offer that the trade unions should accept, and that they should stop “holding a gun” to the taxpayer’s head. Does he agree with that?

The Minister earlier announced that if he had not secured agreement by Christmas, he would impose a pensions settlement or scheme on the unions. Is that still his intention, and if it is, will he make a statement to the House next week?

We very much hope that it will not be necessary for the Government to move to the stage of imposition. Our intention is that we should reach agreement. It is necessary that we reach agreement by the end of the year, because there is a lot of work to do to put the new schemes in place as early as possible, so that people know what their future holds and we can implement the new schemes; so yes, we will be making further announcements to the House before it rises.