The government has been warned that implementing radical changes to public sector pensions could “light the blue touch paper” for strikes by millions of workers.
Labour peer Lord Hutton sparked anger after recommending to ministers that public sector workers should be stripped of their final salary pensions and instead have schemes linked to average earnings, while paying more and working longer.
Unions representing council workers, NHS staff, civil servants and other public sector employees reacted with fury to the report and warned of co-ordinated industrial action.
Jon Skewes of the Royal College of Midwives said members would be “appalled” by the government’s “attack” on their pensions.
“On top of pay freezes, cuts to services and threats to the NHS itself, this will be seen as a slap in the face for hard-pressed midwives and maternity support workers. They will react with anger and dismay and many may vote with their feet and leave the NHS. This will only serve to exacerbate the current and critical shortage of midwives and have a negative effect on the care women and babies receive,” he warned.
Dave Prentis, general secretary of Unison, said the government was treating Lord Hutton’s report with “contempt” and had already decided to increase pension contributions.
“On top of a pay freeze, and the threat of redundancy, they now face a pensions raid. This brings the threat of industrial action closer,” he warned.
TUC general secretary Brendan Barber said: “Public sector workers are already suffering a wage freeze, job losses and high inflation. They are now desperately worried that they will no longer be able to afford their pension contributions, and will have to opt out.
“Even without any changes recommended in today’s report, public sector pensions have been reduced in value by 25 per cent by a mix of negotiated change and the government’s arbitrary switch to the CPI measure of inflation.
“On top of this the government has announced a £2.8bn increase in contributions and a review of the discount rate that could also increase contributions. Even without further changes public sector workers will pay much more for substantially less.”