[A-List] UK legitimation crisis: pensions

["Michael Keaney" <michael.keaney@xxxxxx>]

Millions ready to strike over pensions
By William Kay, Personal Finance Editor
The Independent, 11 November 2002

Pressure is growing on the Government to take action to stem the UK's
growing pensions crisis. As the Trades Union Congress (TUC) was preparing to
launch an attack today on the Government's pensions policy, a new survey
claims that 3 million people are willing to strike in defence of the final
salary pension entitlements.

The survey, by Jupiter Asset Management, shows that 29 per cent of workers -
equal to 3 million - would strike if their pension were threatened, and 36
per cent - nearly 4 million - would joint in a protest rally on the issue.
Substantial majorities - 66 and 58 per cent respectively - would sign
petitions or take their grievance direct to management.

Colin Maloney, Jupiter's pension development director, said: "With around 50
FTSE companies having closed their final salary schemes in the past 12
months, and aggrieved workers already beginning to demonstrate their
displeasure through protests and the threat of strike action, these findings
will make uncomfortable reading for bosses looking to limit future
liabilities by ditching their existing final salary commitments."

But the TUC wants companies to increase, not decrease, their commitment to
their pension schemes.

At a National Pensioners Convention rally today the TUC's deputy general
secretary, Brendan Barber, will urge the Government to take a radical
approach to pension reform, compelling employers to contribute to pensions
and make it easier for staff to join the schemes.

The TUC want the Government's forthcoming pensions Green Paper to recommend
compulsory employer contributions of 10 per cent of pay, possibly copying
the Australian example by phasing it in through a strict timetable starting
at 4 per cent.

Mr Barber will cite a YouGov survey, published on 5 November, in which 59
per cent of respondents believed all workers should be required to pay into
an occupational pension, and almost 80 per cent backed compulsory
contributions from employers.

Mr Barber will say: "The employers said the minimum wage would be a
disaster. They were wrong then, and they are wrong again on compulsory
pensions savings. The public have shown they will back compulsory pension
saving, just as they backed the minimum wage. Employers are instinctively
cautious about being required to contribute 10 per cent of pay into pensions
but this can be phased in, just as the minimum wage is being, and a starting
point of 4 per cent of pay is far less than decent employers currently
invest in staff pensions. Only the bold, tough choices will guarantee
pension security and the Prime Minister was right, his government are better
when they are bold."

But the Confederation of British Industry, the self-styled "voice of
business," promptly hit back by claiming that the TUC risked exacerbating
pension problems by campaigning for compulsory employer contributions. John
Cridland, the CBI's deputy director-general, said: "Unions are right to
focus on pensions problems, but wrong to try and heap the blame on employers
by insisting on compulsory contributions."