Retirement income for state employees under threat

Government spending cuts and reduced retirement perks could make it less attractive to work for the state. The changes prompt a debate on protecting 'frontline' workers.

Whether it's the police force, the army, teachers or fire fighters, those who work for the British taxpayer are facing an uncertain period.

The Government is cutting back spending because, after the financial crash in 2008 and the recession, ministers have decided to make it a priority to balance the UK's books. This means job cuts and pay freezes in schools, hospitals, police stations and local council offices.

Now there's another major change on the horizon. Yesterday, a plan was announced to save money on the annual £30bn bill for public sector pensions – essentially, everyone whose salary is paid by the state will be asked to work longer for less.

The most controversial suggestions involve the 'uniformed services' like soldiers, police and firefighters, having to work until 60. At present, the armed services can retire as early as 40: soldiers and other troops are treated differently because of the risks they run in the line of duty. Privately, officials have suggested that the government is unlikely to provoke a political storm about army pay and perks while troops are fighting - and dying – in Afghanistan.

The trades unions are threatening to fight the changes with strikes, arguing that their members are already 'reeling' from cutbacks. The stand-off between ministers and unions about pay and perks reflects a conflict across Europe and even in parts of America.

Here in the UK, David Cameron wants the balance between the public and private sectors to shift, with more jobs and wealth created by companies and individual businesspeople.

But he has linked this push to an attack on the mindset of another set of public sector workers. In a speech, he labelled civil servants in central government and local councils 'the enemies of enterprise' – provocative language, his critics say. He wants the Chancellor of the Exchequer's Budget statement, later this month, to pave the way for more business growth, and is calling for less regulation or so-called 'red tape'.

New compact?
Unions say their members are feeling victimised.

But should there be financial special treatment for those who choose to work for the state? There is already a well-established convention or 'compact' between the taxpayer and the armed forces – they are treated favourably because they risk life and limb for the rest of us on the battlefield. Some voices are now being raised in favour of extending this 'exception' to other public servants like nurses and firemen, whose work takes them onto a different sort of frontline.

You Decide

  1. Do you see yourself as a future business innovator or entrepreneur? If not, why not?
  2. Are the classroom, the hospital and the firestation the same as the frontline of battle? Are the people who work there more or less valuable to the rest of society?

Activities

  1. Would you choose a risky career with possible very high or very low earnings or a secure job with a comfortable retirement income? Write yourself two different 'career biographies.'
  2. Former US President Bush famously claimed the French didn't have a word for entrepreneur – it's a French word. Research more French phrases in common use in the UK.

Some People Say...

“Why should any workers get special treatment?”

What do you think?

Q & A

What's different about public sector pensions?
Public sector workers can stop work and collect a generous pension at 55, although most stay in their jobs until they are 60. When they retire, their income into old age is based on their final salary, which makes it much more generous than most business schemes basing payouts on average earnings.
So this change will save taxpayers' cash?
The argument in favour is that the taxpayer just can't afford current arrangements any more. The argument against is that people working in schools and hospitals, or those who risk their lives as firefighters and in the armed forces, should be compensated better for their contribution to society.
And it's a Europe-wide debate?
Absolutely – and sometimes it gets quite forceful. In France, those who work for the state are known as 'les fonctionnaires.' They are the butt of jokes and cartoons. But every nation needs people on the payroll to keep the machinery of government and public services rolling.

Subjects

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