FDA attacks pensions 'myths' and demands honesty from Government - 10 December 2004

The Government has no evidence to back its claims that it is closing the civil service final salary scheme on grounds of 'fairness', the FDA said today.

Jonathan Baume, FDA General Secretary, said:

"We are being told that the new scheme is supposed to be fairer to those on low pay or who take breaks in service. How can anyone make such claims when the Government refuses to confirm any detail about fundamentals such as the accrual rate, a crucial factor in any pension scheme? If the Government wants to tackle low pay in the civil service it should raise pay levels.

"What is clear, and the Government appears to accept this, is that if there are improvements, they will be at the expense of those in higher grades. We go further and say that any civil servant, regardless of grade, will be a potential loser from these new career averaging arrangements if they achieve promotion.

"The Government is also promoting the myth that their proposals will encourage mobility in and out of the civil service. We think it may well encourage mobility out, if people perceive that they will receive a substantially worse pension. It will certainly not encourage mobility in. The public sector pension schemes are broadly the same and transfer arrangements are relatively simple. These new proposals will tear the heart out of the transfer arrangements and act as a huge deterrent to people from elsewhere in the public sector transferring into civil service jobs. Yet this is currently how most external appointees join the civil service.

"The Government must be honest about its real agenda. It either wants to cut costs - and they have already acknowledged the savings to be made from raising the pension age to 65 - or the damage to more senior staff will be very substantial indeed. What we need is transparency and honesty."

ends

Notes for Editors
1. The FDA is the trade union and professional body representing the UK's 12,000 senior civil and public servants. Our members include policy advisors, senior managers, tax inspectors, economists, statisticians, accountants, special advisers, government lawyers, crown prosecutors and NHS managers.

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