Government concede victory to unions over pension discrimination for over 4.1 million public sector workers

Stephen Barclay, chief secretary to the Treasury. Pic Credit: gov.uk

Judicial review forces ministers to open negotiations and defer major changes to pension schemes until 2022

Steve Barclay, Chief Secretary to the Treasury,chose a heavy news day today to slip out an announcement that the Treasury had finally given way to the courts and dropped pension discrimination against 4.1 million workers in Whitehall, the NHS,teachers, prison officers and firefighters and ambulance staff .

This came after losing legal battles to the FBU firefighters union, the GMB, the PCS Whitehall union and the Prison Officers Association over what was seen as age discrimination over cuts to their workplace pensions.

The announcement means that terms offered to staff will revert back to the original position – and that includes a lower retirement age – until 2022 and everything is up to grabs during fresh consultations.

£2.4 billion in pension surpluses

It could also mean that some £2.4 billion at present held in pension surpluses, particularly in Whitehall, may have to be redistributed back to the workers in reduced pension contributions or better benefits.

The sting in the tail is that the government want the costs of the victory won by the FBU at the Court of Appeal – which scrapped a discriminatory system that put younger people employed at a disadvantage – should be taken out of the pension surpluses.

The story of the FBU victory appeared in an article in December on this blog.

Any such moves are to be fiercely resisted by the unions. As one GMB official put it: ” We are not going to accept we should pay when we won the argument and the government lost.”

“They knew they were wrong”

Rehana Azam, GMB National Secretary said: 

“It’s welcome that Ministers have in the face of sustained pressure finally U-turned on the pause they imposed on the drawing down of pension benefits. Their indefensible decision has left public sector workers facing financial hardship. 

“GMB has long campaigned for the lifting of the benefits pause the Government unilaterally imposed on our members without consultation. Hard-working public sector workers should now get what they’re owed. 

“The Government has had to make a U-turn because they knew they were in the wrong and were poised to lose the Judicial Review GMB and others had brought against them.  

“Any suggestion that it should now be public sector workers who now bear the costs of Ministers’ discriminatory errors will be fiercely resisted. GMB will not stand by if the Government intends to break its word and force public servants to pick up the bill for its own mistakes. “

The timing of the climb down is interesting as it comes a week before the court of appeal hears the case against raising the pension age from 60 to 66 without proper notice brought by BackTo60 on behalf of 3.8 million women demanding full restitutionb for the loswt money.

The GMB which led the charge over part of the fight is 100 per cent behind the 50swomen and their cause to get their money back.

Firefighters and Judges win £5 billion pensions battle with the government

A victorious Matt Wrack points the way for firefighters to get justice Pic credit : FBU

The new government has suffered two major losses within days of winning the general election over economies made to workplace pensions in the public sector.

First on Monday judges won a victory which will benefit up to 1000 part time judges who lost out on their pensions when they moved from part time to full time work.

They claimed they while they were working part time they were being discriminated against by the government because they were denied pensions. The case had originally been thrown out by a tribunal because it was ruled ” out of time”.

However the Supreme Court, in one of the last judgments presided over by Lady Hale overturned this, and said: ” in the context of judicial pensions, a part-time judge may properly complain: during their period of service that their terms of office do not include proper provision for a future pension; and, at the point of retirement, that there has been a failure to make a proper pension available. “

The ruling could cost the government £1 billion.

Then a few days later after a long campaign by the Fire Brigades Union an Employment Tribunal ruled that following the government’s defeat at the Court of Appeal when current cuts in firefighters pensions were ruled as discriminatory the only remedy was that the pension scheme introduced in 2015 to impose such cuts should be scrapped.

The ruling will not only affect 6000 firefighters who would have had to save an extra £19,000 to offset such cuts but also applies to  schemes for the NHS, civil service, local government, teachers, police, armed forces and the judiciary. This will leave the new government with a £4 billion bill.

A triumphant Matt Wrack, FBU general secretary, said:

“Last Christmas, we gave firefighters the gift of a victory in the courts. This year, firefighters can celebrate knowing that their union has secured their rightful retirement – a gift borne of solidarity that proves what unions can achieve.

“The law has now changed and our FBU claimants will be entitled to return to their previous pension schemes. Legislation will need to be amended, but there can be no delay in implementing this remedy. Firefighters were robbed, and they must now be repaid.

“To the new Tory government, let me be clear. We fought tooth and nail against your attacks on our pensions and won. If you dare to try to pay for these changes by raiding the pensions of current or future firefighters, we will come for you again – and we will win.”

Ministers had spent nearly £500,000 fighting the case which basically left firefighters on a two tier system – with substantially worse conditions for the latest recruits.

In 2015, the Tory-Lib Dem coalition imposed a series of detrimental changes to firefighter pensions, which included a built-in “transitional protection” which kept older firefighters on better pension schemes while younger members were moved onto a new, worse pension scheme, which included a requirement to work until aged 60.

The victory shows once again that the courts can overturn decisions made by governments. Since this applies to workplace pensions rather than the state pension. sadly it is not a parallel case which would bring justice for the 3.8 million women born in the 1950s who have had to wait up to six years for their pensions. But it is another reason for them not to give up hope that they can convince the courts of the justice of their cause.

Revealed: Faked bills and dodgy deals How Assetco conned auditors and ripped off London and Lincoln’s firefighters

london fire engine

A London fire engine then owned by Assetco

CROSS POSTED ON BYLINE.COM

The scandal that led to the huge £3.7m  fine ( reduced to £2.4m after co-operation) against  accountants Grant Thornton and ex  partner Robert Napper is revealed in a dry 56 page report by the Financial Reporting Council.

The biggest con by the privatised company  Assetco responsible for  owning and maintaining the capital and Lincolnshire’s fire engines was in faking additional cash payments from London’s fire brigade when it was asked to do  more work.

Directors of the company took advantage of three extra requests that were approved by London fire brigade – involving new equipment for fire engines and emergency training for 700 of the capital’s firefighters.

In all three cases they fiddled the books to boost the value of the company to shareholders and lied about the cost of the contracts to  gullible auditor Robert Napper and  accountancy firm Grant Thornton.

The London fire brigade wanted its engines to be equipped with new foam pumps and thermal imaging cameras. Under the privatisation deal they could charge large sums of money per month  under a  leasing deal for fitting this equipment. But the greedy directors were not satisfied with this great deal. They decided they wanted icing on the cake and claimed even more to make their company look more profitable. And not just a few pence -literally millions of pounds.

The new foam pumps meant that Assetco could and did charge an additional £2.6m to London fire brigade. But the directors claimed that additionally they were charging London fire brigade another £46,975 a month from April 2009. This produced promised income of another £4.991 million over the next 14 years. But Assetco never even sent an invoice to the London fire brigade. for these sums. It was a complete fake – the money did  not exist and the auditors didn’t spot it.

The same applied to the thermal imaging cameras. The 140 cameras were leased to London fire brigade at a cost of £331,443 a year or £27,620 a month.  But then the directors told the auditors that it had cost over £1m to purchase and fit the cameras and that the London fire brigade was paying over £57,000 a month. This generated a total of  over £5,875m over 13 years. Again this was a complete fake and it would have shown a profit margin of 80 per cent. This went unchallenged by Mr Napper despite queries by his team.

Finally they fiddled the emergency training programme for 700 firefighters. They claimed they were receiving another £71,000 a month for ladders and hoses and guards that they were already were being paid under an existing contract.  They also fiddled the costs. They said it would only cost the company £2m to provide it over five years. In fact it was over £6m.

This catalogue of deceit was aimed at inflating the value of the company. It was particularly despicable because the directors were using the need to improve London’s  fire fighting capability as a vehicle to fiddle the books. But that was not all they were doing and I will come back to it in another blog.