Chamber
Meeting of the Parliament 17 November 2011
17 Nov 2011 · S4 · Meeting of the Parliament
Item of business
Public Sector
I, too, welcome Mary Scanlon to her new post, but I must say that the Conservative motion today might be best described as a “Life on Mars” motion. While everyone else is looking for the way forward to steer Scotland from recession, the Tories are harking back to the 1980s and their disregard for the trade union movement. I note, however, that not only did Ruth Davidson strike in her previous career as a journalist, she seems to be boycotting parliamentary business already. She is just out a week early; perhaps she will be out with us on 30 November after all.
The decision to raise the issue of public service pensions as part of Tory business today merely highlights the failure of the Tory-Liberal coalition to deal properly with pension reform. Instead of working in partnership with the trade unions to try to reform and future proof pensions and ensure decent provision for workers in retirement—we agree with what the cabinet secretary said about the potential in the Hutton proposals—we are being treated to one of the worst-handled negotiations in Government history. We still hope that action can be averted by sensible negotiations between the Government and the trade unions, but thus far there have been months of dither and delay by the UK Government, and we are still waiting to be told what many of Danny Alexander’s most recent proposals mean in detail.
Let us be clear: the unions understand that pension reform is needed. Every trade union takes the position that pensions need to be looked at in a fair and progressive way, but we have seen a series of botched announcements from the coalition, which concluded with Francis Maude’s latest brainwave that the unions could go out on strike for 15 minutes and the Government could then carry on with business as usual, as it were. Mary Scanlon neglected to refer to the change from the RPI to the CPI for the uplifting of pensions, which will have a serious effect; the required 50 per cent increase in annual contributions; the fact that those increased pension contributions will be required for up to eight years longer; and that pensions will be payable to retired workers for up to eight years fewer. Very significant changes are being proposed.
The Tory motion describes the planned strikes as “deeply irresponsible”, but who are the civil servants who are so “deeply irresponsible”? Who are the far-left militants who are determined to smash the state? Perhaps the Tories mean the FDA, which was formerly known as the First Division Association and is now described as the senior public servants union. Some 81 per cent of its members have voted to back strike action. Even the trade union of Sir Humphrey and Sir Peter Housden has had enough. Perhaps Sir Peter will even tear himself away from his blog for long enough to stand by the brazier with his colleagues. Who knows? That is the extent of the hash that the coalition has made of reform. Even senior civil servants who work in Her Majesty’s Government have voted to go on strike.
However, it is not the Sir Humphreys or even the Sir Peters of the public sector who will get hit hardest. Rather, it is the lowest-paid public sector workers who will see the biggest cuts in their pay because of the proposed increase in contributions. In fact, those who earn the least will end up paying much more relatively. It is the refuse collectors, dinner ladies and care home and nursery workers who will get hammered, not the mandarins. Alongside that, the decision, which was taken without consultation or negotiation, to change from the RPI to the CPI for the uprating of pensions will mean a reduction of at least 15 per cent in the real value of pensions even before any further changes are implemented.
There is inherent dishonesty in these changes. They are not about making pensions more sustainable. Rather, they are a clumsy attempt to cut the deficit by hitting public sector workers. It is not so much a reform as a ruse—and a badly played one at that. If the Tories want to cut the deficit, they could back Labour’s plan for a levy on bankers’ bonuses, but I expect that we shall hear scant support for that from Conservative members—indeed, I already hear Mr Johnstone grumbling. The Tory motion glibly talks about the strikes doing
“nothing to help Scotland’s recovery from the recession”,
but it is the UK Government’s botched economic strategy that is cutting growth and increasing unemployment.
It does not have to be that way in Scotland. The Scottish Government is not doing enough to take a different approach here, but it can do so, and it can take a different approach on pensions, too. It falls to Mr Swinney to make decisions on a number of pension schemes. Indeed, we encouraged him to take a different approach on the local government scheme, and it is right that he did so. Different choices can be made for other schemes, although we acknowledge that those choices are not easy.
We support much of what the Scottish Government has said about public sector reform, but the choices that it has made on public sector jobs also affect those who will strike on 30 November. Those people put up with a great deal of pain, including from thousands of job losses—those losses have been proportionately more in Scotland than in the rest of the UK—before reaching the difficult decision to take action. It is not action that is lightly taken, but it has the support of the Labour group in the Parliament.
The decision to raise the issue of public service pensions as part of Tory business today merely highlights the failure of the Tory-Liberal coalition to deal properly with pension reform. Instead of working in partnership with the trade unions to try to reform and future proof pensions and ensure decent provision for workers in retirement—we agree with what the cabinet secretary said about the potential in the Hutton proposals—we are being treated to one of the worst-handled negotiations in Government history. We still hope that action can be averted by sensible negotiations between the Government and the trade unions, but thus far there have been months of dither and delay by the UK Government, and we are still waiting to be told what many of Danny Alexander’s most recent proposals mean in detail.
Let us be clear: the unions understand that pension reform is needed. Every trade union takes the position that pensions need to be looked at in a fair and progressive way, but we have seen a series of botched announcements from the coalition, which concluded with Francis Maude’s latest brainwave that the unions could go out on strike for 15 minutes and the Government could then carry on with business as usual, as it were. Mary Scanlon neglected to refer to the change from the RPI to the CPI for the uplifting of pensions, which will have a serious effect; the required 50 per cent increase in annual contributions; the fact that those increased pension contributions will be required for up to eight years longer; and that pensions will be payable to retired workers for up to eight years fewer. Very significant changes are being proposed.
The Tory motion describes the planned strikes as “deeply irresponsible”, but who are the civil servants who are so “deeply irresponsible”? Who are the far-left militants who are determined to smash the state? Perhaps the Tories mean the FDA, which was formerly known as the First Division Association and is now described as the senior public servants union. Some 81 per cent of its members have voted to back strike action. Even the trade union of Sir Humphrey and Sir Peter Housden has had enough. Perhaps Sir Peter will even tear himself away from his blog for long enough to stand by the brazier with his colleagues. Who knows? That is the extent of the hash that the coalition has made of reform. Even senior civil servants who work in Her Majesty’s Government have voted to go on strike.
However, it is not the Sir Humphreys or even the Sir Peters of the public sector who will get hit hardest. Rather, it is the lowest-paid public sector workers who will see the biggest cuts in their pay because of the proposed increase in contributions. In fact, those who earn the least will end up paying much more relatively. It is the refuse collectors, dinner ladies and care home and nursery workers who will get hammered, not the mandarins. Alongside that, the decision, which was taken without consultation or negotiation, to change from the RPI to the CPI for the uprating of pensions will mean a reduction of at least 15 per cent in the real value of pensions even before any further changes are implemented.
There is inherent dishonesty in these changes. They are not about making pensions more sustainable. Rather, they are a clumsy attempt to cut the deficit by hitting public sector workers. It is not so much a reform as a ruse—and a badly played one at that. If the Tories want to cut the deficit, they could back Labour’s plan for a levy on bankers’ bonuses, but I expect that we shall hear scant support for that from Conservative members—indeed, I already hear Mr Johnstone grumbling. The Tory motion glibly talks about the strikes doing
“nothing to help Scotland’s recovery from the recession”,
but it is the UK Government’s botched economic strategy that is cutting growth and increasing unemployment.
It does not have to be that way in Scotland. The Scottish Government is not doing enough to take a different approach here, but it can do so, and it can take a different approach on pensions, too. It falls to Mr Swinney to make decisions on a number of pension schemes. Indeed, we encouraged him to take a different approach on the local government scheme, and it is right that he did so. Different choices can be made for other schemes, although we acknowledge that those choices are not easy.
We support much of what the Scottish Government has said about public sector reform, but the choices that it has made on public sector jobs also affect those who will strike on 30 November. Those people put up with a great deal of pain, including from thousands of job losses—those losses have been proportionately more in Scotland than in the rest of the UK—before reaching the difficult decision to take action. It is not action that is lightly taken, but it has the support of the Labour group in the Parliament.
In the same item of business
The Deputy Presiding Officer (John Scott)
Con
The next item of business is a debate on motion S4M-01348, in the name of Mary Scanlon, on the role of the public sector.10:31
Mary Scanlon (Highlands and Islands) (Con)
Con
I begin by acknowledging the valuable contribution that the public sector makes to the economy and society in Scotland. It is that hugely valued contribution...
Neil Findlay (Lothian) (Lab)
Lab
Will the member take an intervention?
Mary Scanlon
Con
I will make some progress, if the member does not mind.As recently as 2 November, the UK coalition Government placed a new offer on the table of an 8 per cen...
Richard Baker (North East Scotland) (Lab)
Lab
Will the member take an intervention?
Mary Scanlon
Con
I would like to give some examples so that I can put the member right.A nurse with a salary at retirement of £34,000 would receive a pension of £23,000 if th...
Richard Baker
Lab
I am glad that Mary Scanlon has given me an opportunity to make my point so that she can establish whether I am wrong before she replies to it. Mary Scanlon ...
The Deputy Presiding Officer
Con
You have less than one minute, Ms Scanlon.
Mary Scanlon
Con
I appreciate that, Presiding Officer.When it comes to a cut in pension scheme benefits, the biggest cut that anyone could ever see is the £100 billion that G...
The Deputy Presiding Officer
Con
I call John Swinney to speak to and move amendment S4M-01348.2. Mr Swinney, you have seven minutes.10:41
The Cabinet Secretary for Finance, Employment and Sustainable Growth (John Swinney)
SNP
It is a pleasure to speak on behalf of the Government in this debate and to begin by welcoming Mary Scanlon to her new post. This is new territory indeed—it ...
Neil Findlay
Lab
I thank Mr Swinney for mentioning the new Conservative leader. Given the nature of this debate, is he aware that not long ago the new Conservative leader was...
John Swinney
SNP
That just goes to prove that every individual has a right to protest and to strike and, moreover, to change their mind about these issues.
Patrick Harvie (Glasgow) (Green)
Green
I am grateful that the cabinet secretary reminds us that every individual has the right to change their mind. Will he urge the Cabinet Secretary for Parliame...
John Swinney
SNP
No, I will not encourage the cabinet secretary to change his mind, because it is entirely appropriate that Parliament sits on every day that it is due to sit...
The Deputy Presiding Officer
Con
Order.
John Swinney
SNP
Before we move on to pensions, I want to spend a few moments discussing the public sector. Despite all the warm and considered words in Mary Scanlon’s openin...
Margaret Mitchell (Central Scotland) (Con)
Con
Does the cabinet secretary agree that although focusing on preventative spend is all very well, what really matters is outcomes, and that that is where this ...
John Swinney
SNP
That is just complete and total rubbish. If Margaret Mitchell looks at the Government’s national performance framework, which she derided in her earlier spee...
The Deputy Presiding Officer
Con
You must close, please.
John Swinney
SNP
The Scottish Government will firmly set out to Parliament on 30 November our principal reasons why the UK Government is taking the wrong course. We will make...
The Deputy Presiding Officer
Con
I now call Richard Baker to speak to and move amendment S4M-01348.3. You have a very tight five minutes. We have absolutely no spare time left in this debate...
Richard Baker (North East Scotland) (Lab)
Lab
I, too, welcome Mary Scanlon to her new post, but I must say that the Conservative motion today might be best described as a “Life on Mars” motion. While eve...
The Deputy Presiding Officer (Elaine Smith)
Lab
We move to the open debate. Speeches should be a tight four minutes. Unfortunately, we will have to stop the clock on members at four minutes.10:54
Chic Brodie (South Scotland) (SNP)
SNP
I welcome Mary Scanlon to her new role.In speaking in support of the cabinet secretary’s amendment, I agree with him that this Trojan horse of a motion has n...
Mary Scanlon
Con
Will the member give way?
Chic Brodie
SNP
No—I have only four minutes.This smash-and-grab raid is a means of not only reducing the deficit more quickly but dismissing the sustainability of long-term ...
Neil Findlay (Lothian) (Lab)
Lab
First of all, I thank the Tory party for lodging a very important motion that gives us the opportunity to debate something that we probably do not debate eno...
John Swinney
SNP
Will the member take an intervention?
Neil Findlay
Lab
I have four minutes—not a chance. It was down to the greed of the bankers and their accomplices.