Gregg McClymont MP on Pensions and Shaping Capitalism

Picture of Labour Shadow Pension Minister Gregg McClymont MP addressing UNISON Housing Association Branch AGM at the House of Commons.  Gregg was our keynote speaker on a subject that is very close to the hearts of many UNISON members, who work in the sector due to unnecessary closures and contribution hikes in many of our funds, recent announcements on state pensions and the impending auto-enrolment of non savers into pensions schemes.

He started his speech by teasing me that I was one of the very few Labour supporters who turned up to the Pension fringes at last year's Party conference in Manchester.  These fringes tend to be dominated by financial services lobbyists, who on the whole are not known for being rank and file Labour supporters.

Then he spoke about the recent government plans for the state pension which may be simpler but is in the long run less generous. Despite a lot of noise by this Tory led Government, it actually signifies a withdrawal in state pension provision.

Next, was Private Pension plan provision and their high costs and hidden charges. How can workers work out the value of a company provided pension if they don't know how much it costs? Why doesn't the Government allow NEST (the national pension saving plan set up by the last government with cross party support) to compete without restrictions and therefore bring down costs? (I can hazard a guess; just compare who provides expensive private pensions schemes and who donates to the Conservative Party).

The 3rd and most thought provoking part of his speech was about the role that trade unions and the Labour Party can play on promoting responsible capitalism. Can we use our pension assets and wealth to tackle excess? In Norway there is a massive sovereign wealth fund which is able to influence and promote good company governance practises. In the USA there are also huge public sector pension funds which do the same and change company behaviour for the better.

He posed the question is it a long term  project for the Trade Unions and the Labour Party to shape the future of responsible capitalism through our funded investment pensions schemes? (My answer - Yes)

We had a quick Q&A since Gregg had to go off and vote at a House of Commons division (the bell ringing loudly in our committee room) but I think he understood our "concerns" about the way many of us feel that we are being ripped off by both the state and our employers with regard to Pensions and unless something is done than most face a pretty miserable poverty future.

Many thanks to Gregg and his office for helping to arrange this event.

Hat tip picture Sarah Day our ace Branch admin officer.

A Branch Secretary Annual Report on 2012

This was my contribution to the Branch Annual Report. "2012 has been another appalling year for many of our members.

You may be one of the many Care and Support workers who have had their wages and conditions slashed or you may work in Housing  Management and had another year of pay cuts due to below inflation cost of living rises.

In one of our major employers, it is estimated that in real terms, average pay has been reduced by nearly 14% in the last 5 years since the link with RPI (Retail Price Index) was broken. No wonder so many of us find it hard to manage and pay the bills. While at the same time rental income for landlords has outpaced inflation and many senior executives have seen their pay go up and up.

Some employers and the Social Housing Pension Fund also seem to have taken leave of their senses
and are trying to close down pension schemes due to “funny money” deficits. This decision is wrong and completely unnecessary since they know that the Government has announced that the way we value pensions is nonsense and are reviewing it.

This year our guest speaker at our AGM (12 February) in the House Commons is Gregg McClymont MP, the Shadow Minister for Pensions. No doubt we will be discussing the issue with him!

It has not all been doom and gloom. We have been able to win better than average pay deals in certain
employers and we have protected many members from some of the worse attacks on terms and conditions. Our stewards and branch staff have made a difference and have kept people in jobs, stopped unfairness and supported members going through difficult times.

What has been pretty obvious to me, is by and large, in the employers where we are better organised, with greater membership density, greater number of local stewards and regular joint consultative meeting between the union and management, we have been able to achieve much better pay, protection and pension deals than where we are weaker.

This should be no surprise. This is bread and butter trade unionism. The more of us in the union, the better organised we are, the better deals we are able to get for our members. It is as simple as that.

From April this year it will soon cost you up to £1200 for an employment tribunal hearing if you are unfairly
dismissed, discriminated against or suffer a determent. You cannot rely on your employer or the law to protect you at work. You can only rely on your trade union.

So once again I ask us all to recruit more members and nurture more activists and stewards. It is in everyone’s interests that this happens and it is the only way in the long term that we can increase your pay and better protect you at work.

John Gray

UNISON Greater London Housing Association branch AGM 2013

On Tuesday evening it was my branch Annual General Meeting. Which took place this year at the House of Commons. Thanks to our keynote speaker (and his staff), Shadow Pension minister, Gregg McClymont MP (see top right).

The AGM was very successful with the best turnout I have seen since I joined the branch in 2008.

There were lots of members present who have never been to a trade union meeting before. Hopefully we didn't scare them off and they will return!

On the way into the House of Commons members of the branch gave out "Love Trains, Hate High Fares" postcards to commuters outside Westminster station.

I had been re-elected unopposed as Branch Secretary as was the Chair, Tony Power.

It was a traditional Labour movement annual meeting with introductions; apologies; minutes: meeting; matters arising; branch officers making verbal reports and taking questions on the running of the branch; elections to vacant posts and conferences; rules changes; motions and affiliations.

There was some very good debates and contributions made during the motions and rule changes. 

There is a very serious side of an AGM, since we have nearly 3500 members to defend in the worse of times and a budget of nearly £250,000 to account for to these members. 

After the meeting, there was a less serious side, as we continued to put our world to rights and went to the branch social in the nearby "The Lord Moon of the Mall".

I'll post on Gregg's well received speech on pensions, my reports and the motions over the next week or so. 

UNISON Housing Associations Branch Annual General Meeting 12 February 6 - 8 pm House of Commons

All members are invited to the Branch Annual General Meeting

Tuesday 12 February

6.00 – 8.00pm
House of Commons
Committee Room 18

Speaker: Gregg McClymont MP, Shadow Pensions Minister
Social Housing Pensions * Auto enrolment * State Pension proposals

Full details: http://www.unisonhablondon.org/index.php/about-us/branch-committee

Deadline for motions and nominations is Monday 21 January.

Entrance to is through the Public Entrance – Cromwell Green

Allow plenty of time to pass through security and take your seat

Members who have not visited the House of Commons before can meet other branch members at 5.15pm prompt outside Westminster Tube Station to go as a group to the House of Commons. 

 The meeting will be followed by a social in the local Wetherspoon.
 Prize draw for all members attending the AGM. 

(Picture TUC March for an Alternative 2012)

another busy day for pensions...but is it a good day for future pensioners?

The government today published its white paper on a new "flat rate" state pension for 2017 currently valued at £144 per week. While this is an improvement on the current £107 per week it is expected that in the long term (2060) most pensioners will lose out.

UNISON reminds everyone that £144 is still below the poverty line and Labour Shadow Pension Minister, Gregg McClymont, points out that there will 16 million pensioners in 2017 who will not benefit from the changes and many "Strivers" will be paying extra in National Insurance Contributions.

What has struck me the most about this proposal is the claims that this increase in basic pension will take many people out of means tested benefits so that they will have the incentive to save for their futures under the new pension auto enrolment regulations.

I'm not too sure. Firstly, many low paid are being excluded from auto enrolment. You will have to earn more than £8,105 per year.

Also contributions from employees (3%) and employers (4%) are also just far too low to build up a decent pension and keep the low paid out of dependency upon means tested benefits. In high rent areas if you retire then you are still likely to be on housing benefit and the disincentive to save continues.

But the biggest issue I think is that defined contribution schemes are just plain inadequate. Even relatively good and inexpensive ones like NEST.

Now maths is not my strongest point and this is very much a back of a fag packet calculation. But I have used the NEST pension calculation website to estimate what a male 22 year old on National Minimum Wage (£6.19 per hour 40 hours a week, £12,875 per year) would get if he retired aged 68 after 46 years of defined contribution contributions.

He would receive a pension worth only £1,990 per year (£38 per week) and a lump sum of £22,600. (This is for a pension guaranteed for 10 years after retirement, with spouse pension and pension rises in line with inflation). These figures are subject to stock market performance, annuity rates and not guaranteed.

If he was in a traditional defined benefit 1/80th scheme he would get at least £6,437 per year (£123 per week) and a lump sum of £38,625. He would also get life insurance and ill-health cover. He and his employer would of course have to pay more but the pension would be guaranteed.

Question: So how will you attract the low paid to save for 46 years when they can only expect (fingers crossed) to get a pension worth £38 per week?
Answer: You can't. They are not stupid, they won't do it. Get rid of low pay. Turn a minimum wage into a living wage and auto enrol all workers into a decent defined benefit scheme. Job done. 

Lab12: Last post from Peoples Party Conference

Once again I ran out of time during the 2012 Labour Party Conference to write posts on the last two days. So here is a quick summary of some of the highlights during the last few days of Conference.

Clockwise. Due to disorganisation and meanness I stayed in a hotel in Rushholme which had the worse reviews on Booking.com that I have ever seen. It wasn't that bad but one of the things that kept me fairly sane during Conference was a morning run around the fantastic City green lung Platt Fields Park (the Peoples Park).

Picture of Peoples Republic Newham Crew (and guests) in Midland Hotel bar stairs. Below Gerry Sutcliffe MP, speaking at the EU fringe for Azerbaijan (UK is the biggest investor) ; Ed Balls MP speaking to UNISON reception at the "Peoples History Museum". Ed admitted that he would have lost his seat at the last General election if not for the help of UNISON - "no doubt" and he pledged to never ignore anything that UNISON said but we would not always agree.

Then a very good and sharp fringe on ending poverty by Webb Memorial Trust (lost notes), another on pension auto enrollment with Labour Shadow minster Gregg McClymont sponsored by the Peoples Pension (lost notes); then picture of UNISON reception with Andy Burham MP and Rachel Reeves MP and final centre picture of the great leader with UNISON delegates Mike and Mandy. What a great natural relaxed smile Ed? We never knew!

Roll on Brighton 2013.

Lab12: Workplace pension fringe

This fringe by NAPF/Smith Institute was on Monday. Gregg McClymont MP, pension shadow minister is speaking. Monday (1 October) was of course the day that Workplace Pensions began. So it was pension wise, a special and even historic day.

The Labour position outlined by Gregg is encouraging. He wants full transparency on charges. He wants to encourage scale. There are nearly 50k pension schemes in the UK. Pensions should not be a "cottage industry".  Policy now is for member Trustees for all pension funds (including those run by insurance companies) and changes in fiduciary duties.

NAPF CEO Joanne Segars spoke next about how it is interesting that pensions are being reported for the first time in a largely positive way. By Christmas 500k extra people will be saving for their pensions. Their research is that 2/3rd of people will not opt out. She agreed with Gregg about scale and also the need to have a better alignment of interests between savers and pension providers.

 

My question was that one of the reasons why there has been a low take up of pensions so far is that people are not stupid, they realise that the products currently offered are often pretty rubbish and that they do not want to take all the defined contribution (DC) investment risk.  I wondered if the new look Local Government Pension Scheme 2014 could not be a model for a rebirth of sustainable and affordable defined benefit schemes in the private sector?

 

Gregg thought the idea was interesting while Joanne reminded everyone that many defined benefit schemes were in serious difficulties.

 

This was the first of four pension fringes I attended this conference. One was under Chatham House rules so I can't post on it which is a great shame but I will do the others (eventually).