26oct2_0The Government’s proposals

In discussions with TUC unions including the NUT, the Government has been putting forward a package of proposals for public sector pensions. These would involve teachers:

· paying 50% more – an average 9.6% instead of 6.4%;

· having to work later – with normal pension age linked to State pension age, a teacher aged 34 or under would have to work to age 68 for a full pension

· receiving a “career average” pension based on an annual accrual rate of 1/65 of pay

· Facing lower pension increases in retirement – with the move to the CPI inflation index cutting 15% from the lifetime value of their pension

Today’s offer

The offer is in 3 parts:

· The accrual rate for pensions would be improved from 1/65 to 1/60.

This would only maintain the current accrual rate for the post-2007 Teachers Pensions Scheme, so it is not an improvement compared with the current scheme. It would still also mean teachers paying more, working longer and getting less due to career averaging and CPI pensions indexation

· Teachers within 10 years of their current normal pension age on 1 April 2012 would have “transitional protection”.

This would apply to those in the pre 2007 TPS born before 1 April 1962 and those in the post 2007 scheme born before 1 April 1957. It would mean that they would remain on their current final salary scheme, with the same accrual rate and normal pension age as now, so that their pension entitlements would be unaffected. The Government has also suggested the possibility of further "tapered" protection. Teachers who get this protection would, however, still have to pay 50% higher contributions and face losses from CPI pension indexation, the biggest changes facing this group. The NUT would welcome this protection but teachers in that group should still want to defend younger teachers facing much bigger attacks.

· The Government would promise that this will be the last change to pensions for a “generation”.

It is not at all clear how the current Government can bind its successors. Also, this does not mean that there would be no further increases in teachers’ normal pension ages. The Government wants to retain the proposed link between the TPS pension age and State pension age. This would mean the TPS pension age rising above 68 if the State pension age was increased further or individual teachers’ pension ages rising if the timetable for the planned increases in State pension age to 67 and 68 was brought forward.

NUT Response

The NUT will now be considering its response to the Government proposals in discussions within the TUC and with other teacher unions. The NUT Executive meets next on 10 November. We remain committed, however, to action on 30 November in conjunction with other unions if the Government does not move further to secure a negotiated agreement.

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