The "great pensions divide" - it isn't what you think

Mehdi Hasan on today's pensions strike.

As public-sector workers, including teachers, go on strike today, the (right-wing) papers are filled with anti-union, anti-public-sector-pension headlines and stories. The Daily Telegraph, on its front page, claims that "a mid-ranking teacher on £32,000 a year will receive a final salary pension that is the equivalent of having built up a £500,000 pension pot. This is 20 times higher than the average private-sector scheme, according to figures from the Office for National Statistics."

The Daily Mail headline is:

Great pensions divide: private-sector staff must put in a third of their pay to match state worker benefits.

But the "divide" isn't between private sector and public sector -- as usual, it's between the rich (including newspaper editors!) and the rest of us. Most papers conveniently chose to ignore a report from Income Data Services, published yesterday, which revealed a "widening gap" between the boardrooms and workers.

Thankfully, the Guardian didn't:

Directors in Britain's top 100 companies have accumulated final salary retirement pots worth £2.8m on average, according to figures that reveal a widening gap between the pensions awarded to boardroom executives and the shop floor.

Incomes Data Services (IDS) said about 46 per cent of FTSE 100 directors were still accruing final salary benefits in generous schemes that typically pay two-thirds of final salary as a retirement income.

A pot of £2.8m could buy an employee a pension annuity worth more than £170,000 a year, IDS said.

Using the Telegraph's aforementioned ratio, directors' pension pots are worth more than 100 times as much as the average private-sector scheme. The Guardian report continues:

Company directors, like MPs, have among the most generous schemes in the G20 group of richest nations, with guaranteed benefits worth two-thirds of final salary accrued at an accelerated pace. Many directors can earn their full pension after only 20 years service, while it takes MPs just 26 years. Most workers take between 35 and 40 years to accrue a full pension.

Meanwhile, a letter in today's Guardian reminds us of TUC research in 2009 outlining how:

. . . tax relief on pension contributions of £37bn is heavily skewed towards the better off. Treasury figures show that 60 per cent of tax relief goes to higher rate taxpayers, with 25 per cent going to the top 1 per cent of earners.

Where is the anger? The outrage? Where are the headlines bemoaning "gold-plated" pension schemes in Britain's (failing) boardrooms? As Mark Serwotka, the leader of the PCS union, has rightly pointed out:

It's not public-sector workers who exploit [private-sector workers] but their private-sector employers.

One final point: can we, once and for all, nail the right-wing lie that public-sector pensions are "unaffordable"? The cost of public-sector pensions is set to fall in the coming decades. Don't believe me? The Hutton Report, commissioned by the coalition government and used by ministers as a justification for the "reforms" to pension contributions, states on page 22:

There have been significant reforms to the main public-service pension schemes over the last decade, including increased pension ages for new members and a change in the indexation of pensions from RPI to CPI indexation. Some of these changes have reduced projected benefit payments in the coming decades. For the interim report, the commission asked the Government Actuary's Department (GAD) to project future public-service pensions expenditure. It projected benefit payments to fall gradually to around 1.4 per cent of GDP in 2059-2060, after peaking at 1.9 per cent of gross domestic product (GDP) in 2010-11.

But, as Jon Snow's interview with the Cabinet Office Minister, Francis Maude, on Channel 4 News on Monday evening revealed, the government seems totally unaware of the contents of the report that it commissioned -- and that it now chooses to hide behind.

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

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The campaign to keep Britain in Europe must be based on hope, not fear

Together we can show the world a generous, outward-facing Britain we can all be proud of.

Today the Liberal Democrats launched our national campaign to keep Britain in Europe. With the polls showing the outcome of this referendum is on a knife-edge, our party is determined to play a decisive role in this once in a generation fight. This will not be an easy campaign. But it is one we will relish as the UK's most outward-looking and internationalist party. Together in Europe the UK has delivered peace, created the world’s largest free trade area and given the British people the opportunity to live, work and travel freely across the continent. Now is the time to build on these achievements, not throw them all away.

Already we are hearing fear-mongering from both sides in this heated debate. On the one hand, Ukip and the feuding Leave campaigns have shamelessly seized on the events in Cologne at New Year to claim that British women will be at risk if the UK stays in Europe. On the other, David Cameron claims that the refugees he derides as a "bunch of migrants" in Calais will all descend on the other side of the Channel the minute Britain leaves the EU. The British public deserve better than this. Rather than constant mud-slinging and politicising of the world's biggest humanitarian crisis since the Second World War, we need a frank and honest debate about what is really at stake. Most importantly this should be a positive campaign, one that is fought on hope and not on fear. As we have a seen in Scotland, a referendum won through scare tactics alone risks winning the battle but losing the war.

The voice of business and civil society, from scientists and the police to environmental charities, have a crucial role to play in explaining how being in the EU benefits the British economy and enhances people's everyday lives. All those who believe in Britain's EU membership must not be afraid to speak out and make the positive case why being in Europe makes us more prosperous, stable and secure. Because at its heart this debate is not just about facts and figures, it is about what kind of country we want to be.

The Leave campaigns cannot agree what they believe in. Some want the UK to be an offshore, deregulated tax haven, others advocate a protectionist, mean-hearted country that shuts it doors to the world. As with so many populist movements, from Putin to Trump, they are defined not by what they are for but what they are against. Their failure to come up with a credible vision for our country's future is not patriotic, it is irresponsible.

This leaves the field open to put forward a united vision of Britain's place in Europe and the world. Liberal Democrats are clear what we believe in: an open, inclusive and tolerant nation that stands tall in the world and doesn't hide from it. We are not uncritical of the EU's institutions. Indeed as Liberals, we fiercely believe that power must be devolved to the lowest possible level, empowering communities and individuals wherever possible to make decisions for themselves. But we recognise that staying in Europe is the best way to find the solutions to the problems that don't stop at borders, rather than leaving them to our children and grandchildren. We believe Britain must put itself at the heart of our continent's future and shape a more effective and more accountable Europe, focused on responding to major global challenges we face.

Together in Europe we can build a strong and prosperous future, from pioneering research into life-saving new medicines to tackling climate change and fighting international crime. Together we can provide hope for the desperate and spread the peace we now take for granted to the rest of the world. And together we can show the world a generous, outward-facing Britain we can all be proud of. So if you agree then join the Liberal Democrat campaign today, to remain in together, and to stand up for the type of Britain you think we should be.