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PENSIONS CAMPAIGN UPDATE

PENSIONS CAMPAIGN UPDATE. FEBRUARY 2012. Current position. Government continuing to press for cuts in teachers’ pensions. Government concessions on 2 November were welcome - but not enough NUT action on 30 June and threat of 30 November action helped to secure concessions

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PENSIONS CAMPAIGN UPDATE

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  1. PENSIONS CAMPAIGN UPDATE FEBRUARY 2012

  2. Current position • Government continuing to press for cuts in teachers’ pensions. • Government concessions on 2 November were welcome - but not enough • NUT action on 30 June and threat of 30 November action helped to secure concessions • Government ‘final offer’ on 19 December involves no new money – but some repackaging • Government says negotiations are now over – NUT preparing for further strike action alongside other unions.

  3. Why haven’t we accepted the Government’s offer? • The Government still wants you to pay more, work longer and get less during retirement • Despite the Government’s claims, our pensions are affordable - £46bn more paid in than paid out since the scheme started!

  4. Key elements of Government 19 December offer • switch from final salary to career average. • increase in the normal pension age (the age at which pensions can be taken in full), to state pension age (68 or higher for anyone under 34) • pensions in payment to be increased with only CPI inflation; • if you retire before your NPA pension reduced by 3 per cent a year between ages 68 to 65 - 5% for years below 65 • accrual rate of 1/57th of pay per year of service (up from 1/60); • but built-up pension accruals to be re-valued only by CPI inflation + 1.6 per cent instead of by average earnings

  5. Pay More • Government plans 50% contribution rise, from 6.4% to an average 9.6% by 2014 • Increases start from April 2012 • Further increases in April 13 and April 14

  6. Work longer • Scheme pension age to be linked to State pension age • Under 34? Work till 68 for a full pension • Aged 34 to 50? Work till 67 • Aged 51 to 54? Work till 66 • Transitional protection if within 10 years of current pension age (see later) • Pension age may be even higher in future – 70+ for youngest teachers?

  7. Get Less • Career average means less for vast majority of teachers • Accrual rate of 1/57 of average salary per year but • Lower ‘revaluation rate’ means your pension will lose ground against average earnings over period to retirement • CPI inflation link takes £35,000 from teachers with £10,000 pension

  8. Transitional protection • Teachers within 10 years of NPA on 1 April 2012 stay on existing FS scheme • Teachers up to further 3.5 years away have tapered protection

  9. What will I lose? • Use the updated NUT pensions calculator at www.teachers.org.uk/pensions to see: • How much you’ll lose from your take home pay • How long you’ll have to work for your full pension • How much you’ll lose from your pension if you still retire at your current pension age • How much you’ll lose over a 25 year retirement due to lower pensions and lower indexation • If you’re 50+ at 1/4/2012 – you stay with current pension and retirement age, but you’ll still pay more and lose out from lower indexation

  10. Are our pensions affordable? • Yes – the TPS has already been reformed as a result of our agreement in 2006! • Reliable sources show the costs are already falling as planned • We’ve agreed to pay more – but only if the increase is justified, not to help pay the costs of the recession • Teachers’ pensions aren’t“gold plated” • Continuing our campaign will strengthen our hand in our negotiations and persuade the Government to move further

  11. The real pensions problem • The private sector • Two-thirds of workers have no scheme • 90% of final salary schemes are closed • Employers’ contributions cut by more than half • The result – higher costs to the State and future taxpayers • Cutting public sector pensions just makes everyone poorer in retirement • We need decent pensions for all!

  12. What happens next? • NUT in discussions with other unions on further national action • Priority issues = pension age and contribution hikes • Survey of members about willingness to take part in further action and on-going campaign • Encourage members to SAY YES

  13. What you can do • Hold a workplace meeting – open to all • Use the pensions loss calculator at www.teachers.org.uk/pensionscalc • View the news and briefings at www.teachers.org.uk/pensions • Encourage colleagues to complete the NUT survey • Recruit any non union members to the NUT • Good luck and thanks!

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