Superannuation Bill

Memorandum from Michael Johnson (SU 74)

1. I am a 29 year old PCSPS member. I joined the Scheme on 6 July 2009 , so have been a member for 1 . 2 5 years , a relatively short time. This limits the personal impact of the proposed changes to the Scheme. Nevertheless, the inequity of the content of the Superannuation Bill – and in particular the impact it will have on my colleagues – compels me to submit this evidence for consideration .

2. The Coalition Government has made clear that reducing the deficit in the public finances is its primary objective. While this may be the case, ther e are various methods through which this objective can be pursued . Fundamentally, the deficit in the public finances was caused not by the civil service, but by financial institutions systemic mismanagement of complex financial instruments, both in the UK and abroad. It is inc omprehensible that this Coalition Government considers it appropriate for the consequences of this irresponsibility to be borne by those who are clearly not culpable.

3. As p arliamentarians of various Political persuasions outlined in the debate in the Lower Chamber (7 September 2010), comparing the experience of employees in the public and private sectors is erroneous. Reform of Civil Service terms and conditions may be required, but it is simply unacceptable for alterations to be imposed retrospectively. Any alterations should be imposed on those entering the Civil Service from now on. For example, I am required to contribute to my Civil Service Pension in a way that previous entrants were not. I am perfectly comfortable with this, as the terms and conditions of my employment were clear when I took up post.

The following issues that will affect fellow members of the Scheme are of principal concern:

4. Employees app roaching retirement age are seriously disadvantaged by the content of this Superannuation Bill . The cap in redundancy payments will impose a reduction of up to two thirds of some members’ existing entitlement. Because the Coalition Government has simultaneously annou nced the closure of various public agencies , people made redundant and approaching retirement age face be ing unemployed and with little hope of finding alternative employment given their age and the current economic climate, particularly in parts of the country where the rate of public sector employment is currently relatively high .

5. Furthermore , the introduction of this Bill will make those approaching retirement unable to access their pension until they reach 60. Under the current terms and conditions they would have effectively been entitled to draw their full pension immediately upon being made redundant .

6. Compounding this, many employees will find that the pension they receive will be substantially smaller than that which they have been contributing to for up to 40 years. People will quite understandably have made significant decisions relatin g to their career based on the terms and conditions of their employment – imposing a new set of rules on them at this stage is wholly unacceptable. They risk having neither the time n or the opportunity to make alternative arrangements to cover the substantial shortfall in what the y will receive . A s a result of the Bill s removal of what are co nsidered to be accr ued rights, people will face severe  financial hardship as a result of their contract – moral and/ or legal – being contravened by this Coalition Government.

7. I urge you to reconsider this Bill and find a more equitable way of reducing the deficit. This Bill will have a severe impact on those who have dedicated their lives to public service , yet will make a relatively small contribution to meeting the country’s financial needs, which have been caused by the greed of others .

September 2010