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date: 15 October 2008

embargo: 00:01 hours Thursday 16 October 2008

Public sector pensions are "fair and proper'

Commenting on the Pensions Policy Institute (PPI) report today (Thursday) on public sector pensions, TUC General Secretary Brendan Barber said:

'This PPI report is a useful contribution to the debate on occupational pensions. However, the small but increasingly vocal group who take every opportunity to attack public sector pensions are bound to selectively quote and misuse its findings. They will also continue to ignore the vast costs to the tax payer of paying means tested pensions benefits to pensioners who worked for employers that failed to provide any pension.

'In any civilised society the public sector is an important part of society, otherwise we would not have decent health and education, or effective police forces or national defence. All these public services are labour intensive. Wages therefore make up much of the cost of public services. If public servants are to have decent pensions then this will inevitably be a significant cost.'

The TUC believes the PPI report shows that much of the propaganda against public sector pensions is based on prejudice not fact:

• Public servants have negotiated changes to their pension schemes to reduce their cost and deal with rising longevity, including novel cost-sharing arrangements if longevity increases more than expected.
• Public sector pensions are generally comparable to the defined benefit schemes that exist in the private sector.
• Most public sector pensions in payment are relatively modest.
• Decent public sector pensions do compensate for relatively lower pay at the top end of the salary scale, but the opposite is true among low paid workers where the public sector provides pensions that the private sector generally does not.

Brendan Barber continued: 'Public sector pension critics are inconsistent. They cannot logically attack the Government for the decline of quality private sector pensions and at the same time criticise them for preserving decent public pensions.

'The problem is not fair and proper public sector pensions, but the retreat by private sector employers from their responsibilities. The solution is to level-up, not strip away pensions from vital public servants.'

NOTES TO EDITORS:

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Contacts:

Media enquiries:
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk

Press release (500 words) issued 16 Oct 2008