State pension

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2013 National Delegate Conference
1 January 2013

Conference recognises that many UNISON members, especially low paid and part-time workers, receive very low occupational pensions and many of our members chose not to join the occupational schemes at all. It is important that UNISON remembers that these members are still very reliant on the state pension for their livelihood in retirement.

Conference notes that UK pensioners are among the poorest in Europe with over 2.5 million pensioners living in poverty, 1.6 million of whom are women.

It also acknowledges that under the coalition government, people are having to work longer and pay more into their pension pot to get less on retirement.

Recent governments have primarily attacked state pension provision by increasing the retirement age, currently to 68. Conference notes that in 1948, universal state pensions were introduced for men at 65 and women at 60, in the same year as UK national debt stood at 240% of GDP – more than three times today’s levels. The myth that decent pensions for workers cannot be afforded in a wealthy country such as Britain must be challenged and so must the arguments that longevity makes decent pensions unaffordable. UNISON should be campaigning to reduce the state pension age.

This conference notes the recent Pensions Bill which is to introduce a flat rate state pension of £144 per week from 2016.

Despite the introduction of the Equal Pay Act disposable income for older women is still disproportionate to that for older men. In particular the average state and occupational pension for women is considerably lower than for male pensioners and, that the government’s decision to accelerate the increase in women’s state pension age will affect many thousands of women who will have to work longer to receive their basic state pension.

Whilst the introduction of such a flat rate pension will alleviate the disparity between women’s and men’s pensions in the future, conference believes it is unacceptable for future pension reforms to reproduce historic sex discrimination. Ending sex discrimination must be at the heart of reform.

Conference notes that no new money is to be provided and the increase in basic pensions will be funded by making people work longer and retire later.

People will have to pay more National Insurance and work longer before they can draw their pension in retirement. Contracting out of the state second pension will end and, importantly for our members, this will mean an increase in employee National Insurance contributions (NICs) for those in occupational pension schemes. This will cause additional hardship following a long period of wage stagnation, and alongside higher occupational pension contributions already agreed in the public sector.

Higher employer NICs in the public sector could also have negative consequences for jobs, pay, and public services as employers try to manage this additional cost with no additional funding.

Private sector employers will be able to unilaterally alter the terms of their pension schemes to force their employees to either pay more or get less pension.

Conference also notes that, for those that may benefit from this bill, anyone who has already retired is excluded from the plans, the end of Savings Credit will return some pensioners with savings to being no better off as a result and many pensioners will remain financially disadvantaged.

By combining the basic state pension with the state earnings related pension (SERPS) some future pensioners, probably women in particular, will actually be worse off than under the present scheme.

This Bill equalises state pension payments for men and women for the first time in history, however this does not address the current situation of pensioners living in poverty and reliant on means tested benefits and the proposals do nothing to end sex discrimination in current pension provision.

This conference believes that the rate of state pension should be no less than the official level of poverty which currently stands at £178 per week (before housing costs 2012).

This conference therefore instructs the NEC to work closely with our retired members section and alongside the National Pensioners Convention, Scottish Pensioners’ Forum , other trade unions and relevant organisations, the TUC and the STUC to:

1) campaign to have a basic State pension to be set at or above the defined level of poverty in the UK; and

2) for this increased rate to be paid to all existing and new pensioners;

3) work with the National Women’s Committee to highlight the gap in pension provision between men and women and include the ending of such discrimination in all future campaigning to improve the state pension;

4) work with the Service Group Executives and with other trades unions to seek a common approach to the proposed ending of contracting-out and its impact upon wages and pensions;

5) campaign to reduce the state pension age to the equivalent of previous levels (equalising male and female ages).”

Conference also notes that it was the previous Labour government that introduced the policy to increase the state pension age. It is important that this policy is challenged within the Labour Party. Therefore, Conference calls on the National Executive Council to ask the Labour Link to campaign within the Labour Party to adopt policies to seek to reduce the State Pension Age.