Fresh row over pension reforms
Published 26/11/2012 | 15:34
Proposed pension reforms have sparked a fresh Executive dispute over the "erosion" of entitlements for many public servants in Northern Ireland.
Teachers, policemen and health workers are concerned about changes in how retirement money is calculated, SDLP MLA Alban Maginnis said.
According to Finance Minister Sammy Wilson, the Executive risks a £260 million penalty after ministers were split over how to deal with legislation from Westminster. He said this is equivalent to cutting around half of Northern Ireland`s nursing workforce. Nationalist ministers refused to agree to making the cost-saving measures being passed in London binding in Northern Ireland.
Mr Maginnis asked: "Is the minister not aware that there are many, many in the public sector, teachers, policemen, people working in the health service, dedicated people, who are very, very concerned that this legislation will result in the erosion of their pensions and that they are right to defend their proper interests?"
A review for the Government in Westminster said final salary arrangements were unsustainable and recommended sharing the cost of pension provision more equitably between public service employees and the taxpayer. The reforms would see public sector workers collecting pensions based on career average rather than final salary.
Unions expressed anger at changes which they said meant workers having to pay more into their pensions, work for longer and accept a pension based on career average, rather than the more lucrative final salary arrangement which many are currently on.
The unions complain that the changes will leave public sector staff paying more and working longer for less. Mr Wilson acknowledged the reforms were unpopular but believed the legislation needed to be passed on a UK-wide basis to avoid breaking parity with Great Britain and incurring penalties.
But nationalist ministers refused to agree that there was not time for separate legislation at the Northern Ireland Assembly to allow MLAs to scrutinise the reform. Mr Wilson said: "We have potentially squandered our limited resources on an unnecessary process, resources which we need to use wisely in the current economic times."
He believes the cost of delay by introducing separate Stormont legislation could be £262 million a year and estimated the implementation date for the reforms to be 2015, saying: "The scale of the £260 million cost is simply too much for us to manage and would seriously impact on the delivery of public services here."
He said the cost was equivalent to employing some 5,000 teachers, a quarter of the workforce, or more than 8,000 nurses, equivalent to half the workforce.