1 Work longer or a lower pension?In the face of the rising cost of pensions the Government has announced a policy that it will expect public sector workers to carry on working to age 65 or face a reduction in their pension if they draw it before that age. They propose that this change should start to be implemented in two years time and that there should be consultation in relation to each of the schemes with a view to determining exactly how and when it should be implemented. Amicus opposed this policy when it was first floated in a Government Green Paper on Pensions last year and urged the Government to focus on positive measure to encourage people to work longer rather than coercing them into doing so by cutting their pension pay. We are well aware that the right and ability to retire at 60, or earlier, has been a key part of the advance in living standards and the quality of life over recent decades. The Government proposals New entrants only to be allowed to draw pension before 65 on a reduced basis No change in rights of existing employees in respect of pension earned already Future service pensions of existing employees only to be payable before age 65 on a reduced basis ; but Possible phasing so those within ten years of retirement not affected No pensions after 2010 to be payable before age 55
In the face of the rising cost of pensions the Government has announced a policy that it will expect public sector workers to carry on working to age 65 or face a reduction in their pension if they draw it before that age. They propose that this change should start to be implemented in two years time and that there should be consultation in relation to each of the schemes with a view to determining exactly how and when it should be implemented.
Amicus opposed this policy when it was first floated in a Government Green Paper on Pensions last year and urged the Government to focus on positive measure to encourage people to work longer rather than coercing them into doing so by cutting their pension pay. We are well aware that the right and ability to retire at 60, or earlier, has been a key part of the advance in living standards and the quality of life over recent decades.
The Government proposals
At present employees (other than the special classes) who retire voluntarily at age 55, i.e. 5 years early have their pension reduced by 25% and their lump sum by 14%. This gives an indication of the possible effects.
Nothing has yet been said as to whether special class members (e.g. health visitors or those MHO status) would retain special terms in respect of their future service.
The Department of Health has asked the NHS Confederation to lead a new 'modernisation review' of the NHS Pension Scheme with provision for employer and employee representatives to participate. The implementation of these proposals on retirement age is envisaged as forming part of this review. Amicus Health Sector will be fully involved by continuing to promote good practice. A Campaign Briefing will be produced with guidance to workplace representatives and members.
Further Information