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Employee relationsLatest NewsEconomics, government & businessTrade unions

BCC calls for public sector retirement at 65

by Michael Millar 14 Sep 2005
by Michael Millar 14 Sep 2005

The British Chambers of Commerce (BCC) has called today’s pensions speeches to the TUC conference a ‘disappointment’ after no pledge was made to raise the public sector pension age to 65.

Neither the pensions commissioner, Adair Turner, nor trade and industry secretary, Alan Johnson, said the age of retirement would be raised from 60 to 65, although Johnson did say that the government did want to change the retirement at 60 ethos.

“However, this is in the context of preserving high-quality, defined-benefit, index-linked pension schemes, making improvements to other elements of the schemes, preserving current arrangements for existing staff for almost a decade and introducing arrangements which give individuals a choice about when they retire – be it aged 60 or 65, or later,” he said.

“We can only deliver this within a scheme that is capable of withstanding the demographic changes that are bound to have a radical effect on pension provision.”

He made allusion to the threat of mass strikes after the government tried to impose a rise in pensions ages for public servants before the general election.

“Public servants have a right to expect proposals to change their pensions arrangements to be discussed and negotiated with their trade unions,” he said. “That wasn’t happening before – I hope that Brendan [Barber] and his colleagues accept that it’s happening now.”

BCC director genera David Frost said it was vital that the public sector pension age is increased as public sector pensions liabilities are now at nearly £700bn.

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“This will bring those workers into line with their private sector counterparts,” he said. “In addition, failure to take such action would see pensions costs growing even larger, placing yet more strain on business that has to fund this bill.”

“Government is constantly telling employees in the private sector that they must take greater responsibility for saving towards their retirement. The time has come for public sector workers to grasp this nettle and accept that they must work longer and contribute more to their pensions,” Frost added.

Michael Millar

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