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Pensions Green Paper Briefing

January 2003


This briefing paper examines the Government's Green Paper on pensions entitled, 'Simplicity, security and choice: working and saving for retirement' and how it impacts of UNISON's pension policy. The Green Paper highlights that around 3million people are seriously under-saving for their retirement with a further 5 to 10 million people who need to consider saving more or working longer.

Although occupational and private pensions are reserved matters there are issues of concern for the devolved government in Scotland. The Scottish Executive is responsible for the regulation of public sector pension schemes. These are administered by the Scottish Public Pensions Agency and include pension schemes for the NHS, teachers and local government workers in Scotland.

Government Proposals

The Green Paper highlights a number of proposals by the government on the reform of pensions.

These include:

  • increasing the retirement age of public sector employees from 60 to 65 (for new employees from 2006),
  • simplifying the tax system for pensions,
  • reducing the red tape for occupational pension schemes,
  • establishing an independent pensions commission to report on how effectively the government's approach is developing,
  • encourage pensioners to delay the take up of the state pension until they are 70 years old, and
  • encouraging people to save more.

The main ideas within the paper aim to encourage workers to either save more or work longer to ensure that they can build up a larger pension.

UNISON's Pension Policy

UNISON takes proper pension provision very seriously, with considerable time and resources spent on negotiating, lobbying and campaigning for:

  • A decent Basic State Pension, including restoration of the earnings link,
  • Good employer pension schemes, and
  • Defence of public service schemes in the face of outsourcing.

UNISON believes that pensions are a form of deferred pay and that the state pension will not be enough.

It is vital that employers are be made to contribute their fair share via an adequate occupational pension scheme.

Pension protection is still poor and UNISON continues to fight for members to remain in good public service schemes when they are transferred in and out of Public Service Organisations.

Employers still have too much power over company pension schemes. A Maxwell-style robbery is still very much a possibility. Surpluses in pension funds, supposedly reserved for members, are still accessed readily by employers.

UNISON is campaigning for a majority of trustees to be chosen by scheme members - and control the members' money - and simplification of the Pensions Act to stop employer abuse.

Implications of the Green Paper

If the proposals of the Green Paper are to be implemented then these will have a serious effect on future pension provision including that of:

  • The basic state pension,
  • longer working age, and
  • employer pension schemes.

The basic state pension

The government has indicated in the green paper that it will not restore the earnings link for the state pension. This is clearly against the policy objectives of UNISON. The green paper also proposes to reward pensioners who defer their take up of the state pension until they are 70 years old.

These two proposals will penalise those on lower incomes that would not have any recourse to either secondary earnings or a second pension.

Longer working age

The proposal to raise the retirement age for public sector workers from 60 to 65 will have a disproportional effect on manual and lower paid workers.

This may have an impact on groups of staff who may be physically unable to extend delay their retirement date. This may include ambulance crews who often retire early due to the physical nature of their employment.

It also ignores the problems facing older workers in retaining their jobs as well as those looking for new employment. Age Concern have stated that there are not as many people in full-time work at retirement age because they have been pushed into taking incapacity benefit or going part-time by their employers.

Also, the UK already has the longest working hours in Europe and by raising the retirement age, this will lead to UK workers having the longest working life the EU.

Employer pension schemes

Although the green paper removes some barrier to employers establishing an occupational pension scheme, it relies on a voluntary approach.

There are no proposals in the green paper that would help stop the decline of final salary schemes.

UNISON believe that there needs to be a partnership between employers and employees, with an element of compulsion to ensure that both partners contribute to a suitable pension scheme.

Further proposals from UNISON would include an end to the right of employers to modify or discontinue schemes/ contributions without restraint as well as flexible consultation with trade unions and democratic control of funds.

The government's decision in their Green Paper to give voluntarism one last chance is only postponing the day that employers face an obligation to contribute to staff pensions.

Action for Branches

The government is consulting on this Green Paper until 28th March 2003.

This briefing paper is intended to stimulate debate about pension provision for members, and as such, all replies will be welcome. It is also important for branches to be aware of UNISON's pensions policy (see further information). Branches could use any negotiations over flexible retirement dates as an opportunity to promote UNISON's policy objectives.

UNISON headquarters are preparing campaign materials on this issue.

Department of Works and Pensions:


UNISON Proper Pensions Campaign


TUC Pensions information



Further Information

Department of Works and Pensions:

UNISON Proper Pensions Campaign

TUC Pensions information

Contacts list:

Dave Watson -

@ The P&I Team
14 West Campbell St
Glasgow G26RX
Tel 0845 355 0845
Fax 0141-307 2572