Public Sector Pensions

Alun Cairns Excerpts

Thursday 8th December 2011 Commons Chamber

[Hywel Williams]

Honestly, I think we need to move on to the subject of the debate. I am sure that the right hon. Gentleman will have time later to make those and other fatuous points.

[Alun Cairns (Vale of Glamorgan) (Con)]

I would like to take the hon. Gentleman back to what he said a few moments ago and remind him that when Plaid Cymru was part of the coalition in the Welsh Assembly Government, its members refused to cross the picket lines at that time, too.

[Hywel Williams]

Well, honestly, I am sure that you would not want me to be diverted down this particular route, Madam Deputy Speaker.

--- Later in debate ---

[Hywel Williams]

The bulk of my speech, as one would expect, is about the Government’s proposals, but the hon. Gentleman will have to wait and see.

Lleu Williams from University and College Union Wales told me:

“We are pleased that MPs will debate public sector pensions a week after tens of thousands of people in Wales took industrial action to show how angry they are…The action last week, alongside the debate on public sector pensions, is testament to the strength of feeling on these issues”

in Wales. He continued:

“We hope today’s debate sends a clear message from the people of Wales to Westminster that we will not go quietly into the night over these proposed changes.”

I have heard from the other side that union members did not support the strike—they have deserted the cause, as it were. UCU general secretary, Sally Hunt, confirms that it saw record recruitment levels both before and after the strike. That gives the lie to that one. Finally, the National Union of Teachers welcomes today’s debate and says that rather than creating an unnecessary and damaging divide between the public and private sectors, Ministers would do well to focus their attention on securing fair pensions for all if future Governments are to avoid pensioner poverty on an unaffordable scale, which is the point that I made earlier regarding future dependence on state benefits.

I shall refer briefly to that bunch of hard, crazed revolutionaries, the British Medical Association, which strongly opposes the plans set out by the Government to reform the NHS pension scheme, including increased contributions from doctors; raising the standard pensionable age for staff; and devaluing many pension settlements. It queries whether the NHS pension scheme is in need of reform, given that it underwent a major overhaul only three years ago. It says that the scheme is in very good financial health, and generates a surplus for the Treasury. Indeed, over the seven years from 2009-10 to 2014-15, the NHS pension scheme is expected to provide a surplus of £10.7 billion for the Treasury.

The BMA is engaged with the Governments in Westminster and in the devolved nations on the proposed reforms to pensions, but it has not ruled out balloting members on industrial action over the matter. It is thinking of moving towards action, and its decision will be informed by a ballot at the beginning of the year. That is just a sample of the views and arguments that we have heard—there are plenty more.

One of my constituents, a small business person—such people are often cited by the Government as those who would suffer as a result of the strike—said to me on the day of the strike:

“They”—

the Government here in London—

“think that people like me don’t support the strike. They’re wrong. A lot of my business comes from county council workers. How will I keep going if they don’t have the money to spend?”

That shows the interaction and co-dependence of the public and private sectors in areas such as mine.

[Alun Cairns]

If that argument is to be sustained, is it not logical that the way to resolve the economic problem is simply to make the public sector as big as possible, and the private sector can then profit?

[Hywel Williams]

I am surprised to hear the hon. Gentleman arguing for that. I thought he took the contrary view, but perhaps my sense of irony is underdeveloped.

The Office for Budget Responsibility estimated in March 2011 that 400,000 people in the public sector would lose their jobs. In its response to the autumn statement, that rose by nearly 80% to a disastrous 710,000. One further, crucial reason as to why we in Plaid Cymru and the Scottish National party have called this debate is that public sector jobs are disproportionately important to countries and regions outside London and the south-east. Paying an extra 3% out of their wages is bad for individuals wherever they live, and I have particular sympathy for those in inner-city areas with high costs such as public service workers in central London. Looking across the UK, the 3% imposition and the job losses will have a particularly strong impact on Scotland, Wales and the north of England, especially as the private sector is generally weaker in those areas.

That will be even more the case if the Government follow Labour’s lead in 2008 and introduce regional rates of pay, as my hon. Friends have said. The figures on the size of the public sector are clear, sad and revealing. Briefly, in Scotland the public sector accounts for 28.6% of jobs; in the east the figure is 23.7%; in the north-east it is 29.4%; in the south- east it is 22.8%; in Wales, unfortunately the figure is highest at 31.2%; and in London it is 22%. There is a clear north-south divide. The people we represent will be hit particularly hard, as will our local economies because of the grotesquely distorted, south-east-weighted economic development of the UK and the obsession with the City of London.

This morning I received an e-mail from Mr Mark Rowe, a PCS member from the Devon area. I do not know Mr Rowe; I have never met him, and I do not know what his politics are, but he said this in his e-mail:

“Dear Mr Williams, Thank you for supporting hard working public servants in their struggle over pensions. It is good to know that someone is. We had a huge rally through Torquay on the 30th, hardly a ‘damp squib’”—

as it was described by the Government. He added that there had been “much public support” and asked why Labour are not “fighting our corner”. Public sector pensions have not been the subject of a single full Opposition day debate in the House for the past 18 months, despite the fact that Labour has had 36 Opposition day debates since the public sector pension changes were first introduced in 2010.