Lord Hutton calls on Miliband to support pension reform plans

Former Labour business secretary also says that unions should stop threatening strikes and that people need to ‘face reality’ The former Labour business secretary charged by the coalition with overseeing its contentious pensions reforms has called on his party leader to back his plans and ask union leaders to stop threatening strikes. Lord Hutton said people had to face the “reality” that public sector pension reform was necessary and that strikes would not “make this problem go away”. When asked if Ed Miliband should oppose the threat of industrial action by the unions that backed him to become party leader, Hutton said “of course”. He also said he would like to see Miliband endorse his report. The government and unions have been at loggerheads since the end of last week when ministers went public with plans to extend the retirement age and increase pension contributions for millions of public sector workers. Union leaders felt that ministers had pre-empted negotiations with the announcement. The head of Unison, Dave Prentis, and other union leaders threatened the biggest wave of industrial action since the general strike of 1926 after the chief secretary to the Treasury, Danny Alexander, made the announcement on Friday. The Treasury later said that Alexander was articulating proposals for reform, not settled government policy, but Prentis said that Alexander’s speech had effectively rendered the talks meaningless. Despite making conciliatory noises, Alexander said that the government had “contingency plans” in the event of a major strike. Shadow chancellor Ed Balls warned trade unions not to fall into George Osborne’s “trap” by striking. The chancellor was hoping for the unions to embark on industrial action, Balls said, so that he could blame any weak economic recovery on walkouts. “This is not a political decision from the unions, this is actually their members feeling very upset. George Osborne is desperate to have that confrontation – he’s been saying it for months. The trade unions must not walk into the trap of giving George Osborne the confrontation he wants to divert attention from a failing economy.” His party colleague Hutton disagreed with Balls, telling BBC1′s Politics Show: “There are still negotiations going on and those negotiations should continue. “I don’t personally believe that ministers want to provoke a confrontation with the trade unions – quite the opposite, I think they’re trying to find an agreement. “It’s an uncomfortable truth, but I’m afraid it’s the reality, that the world is changing around us and people are living for much longer, and we have not been paying for those extra years of pensions – the taxpayer has. Strikes won’t make this problem go away, we have to act now. If we don’t act now, it’s our kids who are going to pick up the tab, and it’s not right.” Asked whether he would like to see Labour leader Ed Miliband back his recommendations, Lord Hutton replied: “I’d like him to endorse the report I produced, yes, because I think it does strike the only fair balance.” It also emerged today that the coalition may consider softening changes to women’s pensions after facing a revolt from Tory and Lib Dem MPs. The government would like to increase the age at which women qualify for a state pension from 60 to 65 by 2018, two years earlier than planned by the Labour government. Ministerial talks are supposed to be taking place, with Iain Duncan Smith said to be sympathetic, but in public he will tomorrow say the government is determined. At the second reading of the pensions bill, Duncan Smith will tell MPs that delaying the increase in the state pension age would cost the public finances £10bn. He is expected to say: “We’re heading towards an unprecedented burden being placed on the next generation who will have to pay for their parents’ retirement on top of paying for the national debt. It’s not fair. This bill will address the realities of our increasing longevity by sharing the costs between the generations. We will stand by the 2018 and 2020 timetable.” Three unions are due to strike on 30 June, but the Association of Teachers and Lecturers has said it will call off the walkout if the government is willing to discuss the level of increases to pension contributions. Mark Serwotka of the Public and Commercial Services Union , which represents almost 300,000 civil servants, told the BBC it was very unlikely that the walkout would be called off. Responding to Balls’s warning of a “trap”, Serwotka said: “The problem with what Ed is saying is this: if he’s me, representing people, many of whom are on £15,000 per year – they work hard, they’re on poverty pay, they don’t look forward to a very big pension. If all of that’s being taken away and you work longer, pay more and get less, what frankly are we supposed to do? Are we supposed to sit back, say it’s unfair and do nothing?” Prentis, whose union represents people working for local authorities, the NHS, colleges and the police, said he had not yet balloted his members on action but would if they continued “to be treated with disdain”. “If we go back into negotiations on the basis of dialogue but no changes in the proposals, what’s the point in that?” he told the BBC. “If we can get an assurance that the talks are meaningful … then obviously we’d continue the talks, but we didn’t get that impression on Friday.” Responding to the same suggestion by Balls, Prentis said striking methods would be “smarter”. He told Sky’s Murnaghan programme, “It won’t be like the miners’ dispute where we will be starved back into submission. This will be a lot smarter than that – this will be about regional action, branch action, this will be sustained action. Because I believe that this government will not turn after one or two days, and our members have got to be prepared for that, and I believe that they are.” Alexander said the government was “absolutely not” trying to provoke a battle with unions. “There is a huge amount of room for dialogue,” he told Sky News. “There is a huge amount of detail about public sector pensions that we’ve been discussing in the talks … and we need to take that forward over the coming months.” He insisted the talks could still be constructive, adding: “I don’t think my message is uncompromising at all.” John Cridland, director of the CBI , dismissed the impact that public sector union strikes could have. He said: “Today the most they can do is disrupt people’s lives – it probably won’t disrupt the economy.” Public sector pensions John Hutton Ed Miliband Public sector cuts Public services policy Public sector pay Public finance Pensions Allegra Stratton guardian.co.uk

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