10 March 2011
(For immediate release)
Hutton pensions report: FDA response
Responding to the publication today of Lord Hutton's report on public sector pensions, Jonathan Baume, FDA General Secretary, said:
"There are some interesting and thoughtful aspects of Lord Hutton's pensions report, as well as highly controversial proposals such as raising the pension age to at least 65 and closing all final salary schemes. There is a strong danger, however, that the Government will pick and choose the bits it deems most palatable.
"The Government has already pre-empted the report by changing the indexation of pensions from the retail prices index (RPI) to the consumer prices index (CPI), which will slash a minimum of around 15% from the value of a public sector pension. Additionally, the Government is seeking to increase contribution rates by at least an average of 3% by April 2012.
"This double-edged scythe will be seen as simply a form of additional taxation.
"Any changes to pensions for senior public servants will have to be agreed by scheme members themselves. Moreover, senior public servants are not only likely to suffer the biggest rises in pension contributions but would also lose most from closing final salary schemes. Negotiations in the coming months will be complex and difficult, and our members will be very sceptical about agreeing to changes if the Government insists on increasing contribution rates and diluting pension benefits. Furthermore, changing the goalposts - particularly for those coming up to retirement - will be seen as wholly unfair and unacceptable."
Notes for editors
1. The FDA is the trade union and professional body representing 18,000 of the UK's senior civil and public servants. Our members include policy advisors, senior managers, tax inspectors, economists, statisticians, accountants, special advisers, government lawyers, diplomats, crown prosecutors and NHS managers.
2. Members in HMRC are represented by the Association of Revenue and Customs (ARC), a section of the FDA.
3. The FDA (formerly the First Division Association) should be referred to simply as "The FDA" and can be described as "the senior public servants' union".
4. For further information contact:
- Jonathan Baume, FDA General Secretary, tel: 020 7401 5555 or 07976 951191.
- Oliver Rowe, Communications Manager, tel: 020 7401 5588 or 07590 838696.