|N E W S F E E D S >>>|
Caithness News Bulletins February 2006
23 February 05
Local Government Pension Changes - Boring Topic But Huge Implications For Low Paid
Women May Fare Very Badly Under The Local Government Pension Changes Proposed
Bill Fernie is a local councillor for Wick West and is very concerned about the impact of the changes in the Local Government Pension Scheme being proposed by the government and in Scotland by the Scottish Executive. The topic is one which most people do not think much about until retirement is looming. However this is one that will have a dramatic affect on many local government workers and especially on low paid women workers. The changes are being instigated apparently to comply with European legislation. However various European spokesmen have denied that it is necessary for the UK to do so and that the decision is finally one for the UK government. Unions are lobbying to prevent the changes adversely affecting their members as is their job. One group in particular may fare worse than others. they are women. Many of the public think of local government workers as having feather bedded jobs with big pensions. That is because they see and hear mainly from the managers at the top either in the media or through correspondence when they have to contact a council.
The truth is that most local authority workers who will be adversely affected by the changes and particularly the removal of Rule 85 are low paid women workers. They include a vast range of jobs - many part-time and form women who may have had to have short careers to bring up children. These women are the dinner ladies in schools, cleaners, care workers in the community and in care homes, health related and environmental workers and a whole host of others. They work in many essential jobs that are low paid. They mainly do not build up the years of service to get a "Good Pension". Instead they retire with pensions of about one third of men's as they have not usually worked long enough to qualify for larger amounts. It is these same women who may be denied the right to retire early under the 85 rule if is is abolished.
Whilst the abolition of rule 85 will apply equally to men it will have disproportionate affect on women as they are in the greater numbers in the low paid, physically demanding and often stressful jobs. The higher executive usually male sitting in a management job behind a desk will not see much difference and may have less need to use rule 85 to take early retirement and whenever he does the pension will be many times higher than the low paid female worker. A similar situation does apply to low paid men but they will often have longer service where they may have similar pay levels.
This page has been put together highlighting the issue for women but it equally applies to many low paid male workers who may only have worked for a local authority for a very few years. Whilst we all know there is growing problem with an aging population it is no help in dealing with the problem fairly if people in the most vulnerable and situations with low pay and few years of service are to be affected worse than others at the top. The putting in of "years of service" should not be the only qualification to a good retirement. Many people put in years of service in looking after elderly relatives or disable children and obtain employment later in life in many of the essential but low paid jobs in local government. We should NOT be hitting them again. The suggestions on the proposed changes to this pension scheme need to be rethought.
What Can You Do?
In mid January 2006 the Minister for Finance and Local Government Reform announced that the Scottish Executive intends that the Rule of 85 (follow link to current provisions) will be removed with effect from 1 October 2006 in order to ensure compliance with the EC Equality Directive and to help maintain the sustainability and affordability of the Scottish scheme. Where it can be objectively justified consideration will be given to providing transitional protection to those existing scheme members who might have qualified to receive an unreduced early pension under the Rule if it was not removed, and who may not have sufficient time to make alternative savings plans for their retirement. - From The LPGS web site
Women And The Local Government
Pension Scheme -
From Unison web site
Why then are LGPS members being treated less favourably than members of other public sector schemes like uniformed police and the armed forces whose members are largely men? And other public sector schemes with smaller proportions of women? Those schemes have all been given protection of their existing benefits and retirement age. Women in the LGPS haven’t.
The Government is planning to remove the ’85 Rule’, which enables LGPS members to take an unreduced pension from 60 if their age and membership of the LGPS adds up to 85. The only protection they are proposing is for members over 53. This will hit women particularly badly. Consider this…
• 72% of LGPS members are women
According to actuaries employed by the
According to Government appointed actuaries, retirements in 2004-5 show that …
• The average woman’s pension is just
£1,616 a year, compared to £5,699 for the average man
This means that most women’s pensions fall below the Government’s Minimum Earnings Guarantee and Pension Credit levels. They are therefore paying into the LGPS and drawing on its funds for no more basic pension than they would get if they did not join. UNISON believes our members should stay in and contribute to an independent income as the Government wants, without having to rely on benefits, but the choice for many is tough.
• 22% of men retire early on ill health
grounds with a pension of £6,110
Poorer pensioners die younger
Are all eligible women in the LGPS?
• 83% of full-time women, compared to 90%
of full-time male workers were members
What about the state pension?
According to the Department of Work and
• The same protection for women in
the LGPS as men in other schemes like the uniformed police and armed
forces schemes, where the retirement age is already much lower than 60!