Pensions

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Conference
2002 National Delegate Conference
Date
9 May 2002
Decision
Carried

Conference notes that employees rely on the pension earned during employment to provide a reasonable standard of living in retirement and financial protection for their families and partners in the event of death or ill health. State provision has never been enough on its own.

Conference further notes that:

1)The UK is heading towards a crisis in its pension provisions for the future;

2)Occupational pension schemes cover only half the workforce, and half of those are under threat from money purchase arrangements;

3)The move towards money purchase schemes will create a detriment to UNISON members and workers in general and will only be of benefit to employers who seek to cut costs. In particular, the private contractors who compete for public sector contracts, such as those in local government, would welcome a reduction in their bidding costs by not having to cost into contracts the price of decent final salary pension schemes in local government or indeed any other pensions provisions that impact on their drive for profits;

4)Current low interest rates and investment uncertainty means that the cost of pension provision is increasing and many employers are using the excuse of higher costs to close good final salary schemes for new members and provide inferior money purchase arrangements instead;

5)To secure a two-thirds final salary pension at retirement around 20 per cent of the employees’ pre-tax income throughout life would need to be contributed to a pension scheme, for low paid workers this would equate to around £50 per month in order to achieve a meagre sum equal to the means tested minimum income guaranteed by social security;

6)Current employment law offers little protection and the Government’s proposals with regard to revised Transfer of Undertaking Protection of Employment (TUPE) Regulations, which the Government purports is to enhance the rights of employees, simply offer continuing inadequate protection particularly for public sector workers who face privatisation.

7)The contribution to the development of a two-tier workforce by the inadequate pension protection for workers with one set of employees enjoying the benefits of a final salary scheme and new starters who may find they have no pension provision or an inferior scheme despite actuarial assessment;

8)Existing union policy that pension schemes should provide a minimum income on retirement based on a proportion of final earnings.

Conference calls on the National Executive Council to:

a)Continue to press Government for strengthened regulation to protect transferred workers and ensure that TUPE legislation covers pension provisions and ensures adequate pension at retirement;

b)Consolidate our campaign for good pension schemes by:

i)Developing a union-wide strategy on the issue of pension provision, including joint work with service groups and the commissioning of relevant research on the impact of current pension provision on our members;

ii)Promoting the advantages to members of joining and remaining in good pension schemes, particularly among young members who need to be aware of the threat to their future pension provision if defined benefit schemes continue to decline;

iii)Promoting the advantages of good final salary pension schemes and combating the arguments for closing them down;

iv)Insisting that any contractor bidding to take over a public service is legally compelled to guarantee to both existing staff and new starters a pension scheme which is at least as beneficial as that which was available when the service was publicly owned;

v)Campaigning for employers to provide a suitable defined benefit scheme instead of a stakeholder but where there are money-purchase schemes, ensure that the employer pays sufficient contributions, in order to provide a chance of benefits matching those in defined benefit schemes at retirement.

c)Continue to campaign for the restoration of the earnings link and protection of the relative value of the basic state pension and opposing the means testing of state pensions. The current uncertainty surrounding the whole question of pension provision underlines the need to step up in every available arena our campaigning for the pensions/earnings link to be restored to at least the level it would have been at if the link had not originally been broken.

This Conference therefore agrees that UNISON:

I)Identifies members that act as Pension Fund Trustees to create a national database to allow for mapping of pension developments and activities particularly in regard to employers’ proposals to close pensions to new starters, or convert company schemes from final salary schemes to money purchase schemes;

II)Ensures regions analyse the pensions issues as a result of contracting out arrangements and provide written quarterly reports to the national Union on each and every branch within their region as to pensions developments, and notes that this report will need to be prescriptive as to content as the quality of information from regions is usually too scant and varied to provide the basis of constructive information;

III)Campaigns in conjunction with the TUC for simplification in the pension system to enable employees to appreciate and access good pension provision, to expose those companies that seek to cut the deferred pay of workers, and to continue the campaign for a decent state pension, and restoration of the earnings link;

IV)Assesses the current legal protection available to employees who are coerced into changing their pension arrangements and seek any possible legal redress such as claims against the employer and ensure that advice, as to the pension provision referred to in individual contracts of employment and collective bargaining arrangements, is unambiguous to avoid the legal uncertainties that have surrounded legal challenges to changes to company pension schemes and individual pension rights;

V)Works with the Institute of Employment Rights, the National Pensioners’ Convention and the TUC for any changes in UK employment law that would secure better protection of pensions for workers, and, bring them into line with other protected terms and conditions, and to commission Counsel’s opinion to examine how pensions could reliably be brought within the remit of fair wage provisions;

VI)Instructs the National Executive Council to commission a members’ guide to pensions in plain, unambiguous language to ensure members have a trade union source of pension information and to give consideration to an additional member service of free access to an FSA registered adviser on pensions when facing transfer to a private company. The members’ guide to be published no later than 1 January 2003;

VII)Campaigns for statutory rights for employee representatives on all pension panels and boards of pen