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State pension should be financed by progressive taxati...

State pension should be financed by progressive taxation says Unite

14 January 2013

Responding to the Tory-led government's proposals to change the state pension, Unite, Britain's biggest union, says the changes should be financed out of progressive taxation, not by reducing the modest state benefits of average earners.

Unite assistant general secretary Gail Cartmail said: "Unite will be looking carefully at the proposals and small print because experience shows us you can't trust the coalition with our welfare. The government has given no indication that there is more money available for the state pension. This means for every winner there will be a loser.

"If the government wants to improve the state pension of those who fare worst at present, then it should be financed out of progressive taxation, not by reducing the modest state benefits of average earners who have a full career.

"These proposals could present real dangers to workers in the private sector. The new system will involve higher national insurance for employees currently in contracted-out defined benefit pension schemes, and higher national insurance for their employers as well. There is a danger employers will seek to claw back the cost by reducing the quality of their current pension scheme. The end result could mean any gain in state benefits will be wiped out by increased costs to employees in the private sector."

The government's proposals on the state pension will be published in a white paper. Reports indicate the government will be proposing implementation in 2017.

ENDS

Contact Ciaran Naidoo on 07768 931 315

Notes to editors:

  • Unite is Britain and Ireland’s largest trade union with 1.5 million members working across all sectors of the economy. The general secretary is Len McCluskey.