Britain: Blair’s pensions climbdown

Threat of co-ordinated strike action by public-sector unions over pensions forces major climbdown.

Most trade union activists are aware that this will be a temporary retreat by New Labour, buying time and breathing space in the run-up to the general election. Nevertheless, as the Financial Times commented: "The retreat is a huge climbdown by ministers."

In the face of over one million angry workers taking strike action and with the prospect of others joining them in the run-up to the general election, the government has effectively caved in.

But they did it in such a way that it will give workers confidence that they can win and force a complete retreat over plans to raise the retirement age for public-sector workers from 60 to 65 and worsen their pension entitlement.

A panicked Blair instructed Alan Johnson, the Department for Works and Pensions Secretary of State, to sort out the problem.

A day later a letter went from Johnson to TUC general secretary Brendan Barber. In the letter Johnson recognised the unions’ concerns that the "government was proceeding by diktat"… "that there had not been genuine dialogue" and that "it was time to make a fresh start".

He promised that the government would give "assurances that these would be genuine negotiations… on all levels of change" and concluded that he hoped this would enough "for the unions to call off the action on 23 March."

The government has promised to annul the regulations that were in place in Parliament to change the local government pension scheme from 1 April. A letter was due to go from the head of the civil service to the civil service unions saying that the same applies to the proposed changes to civil service pensions.

It is likely that the same will apply to health and education pension scheme proposals.

Interviewed on Radio 5 on 19 March, Alan Johnson was reminded that the government had said only a few weeks ago that the raising of the public-sector retirement age from 60 to 65 was "non-negotiable" to which he replied: "What can I say? Mea Culpa. We got it wrong."

The climbdown on public-sector pensions by the government will mark a turning point in the relationship between organised workers in the trade unions and the government and bosses. Some will be frustrated that the strike action is suspended. But knowing that they have forced the government to climbdown after strike action will have greatly increased the confidence of working-class people. The fact is that the unions have won a major victory without a shot being fired.

Organised workers have been in this position before. In 1925 the miners and those unions organised in the triple alliance threatened a general strike which forced a major retreat from employers and government. But the ruling class came back a year later having made preparations to smash the general strike.

In 1981 ’Iron Lady’ Thatcher retreated in the face of threatened national strike action by the miners’ union NUM. However, she and her Tory cabinet ministers went back to make their class war preparations for their onslaught on the miners in 1984-85.

Correctly, unions like the PCS civil service union and UNISON are keeping their ballots for action in place, only suspending the strikes scheduled for 23 March, to wait and see if the government delivers on its promises before the likely general election on 5 May.

Other unions that are currently balloting for action, such as education unions Natfhe and the NUT, should continue with their ballots to ensure they have a mandate for action. Although the NUT is calling off its ballot we think, along with activists in the union, that this would be a mistake. The threat of action before a general election is still needed to ensure the government departments start genuine negotiations immediately.


UNISON leader Dave Prentis has claimed that this "shows social partnership at its best", implying that Labour was delivering on the promises made from the Warwick Agreement last July.

However, it is worth recalling that the Warwick agreement talked of Labour and the unions agreeing to "engage in effective dialogue over the future of public-sector pensions."

New Labour’s interpretation of "effective dialogue" meant announcing the changes being outlined for the NHS and civil service without any consultation. For months government ministers were unavailable for talks with union leaders on the issues.

Yet, Alan Johnson’s letter to Brendan Barber notes "concerns were expressed about the Government appearing to proceed by diktat on some issues." And further he adds: "I recognise that there are concerns about whether, in every other case, a genuine dialogue has been able to take place."

And he concludes by saying that "I hope that these assurances that genuine negotiations can take place on all aspects of possible change and that the proposed high level discussions will facilitate a meaningful dialogue on the government strategy right across the public services on this issue will enable the unions concerned to call off any planned industrial action."

It is clear that Blair and his government were forced to recognise that the organised working class was not just any other pressure group, like the Countryside Alliance or Fathers4Justice. According to the Financial Times, the threat of co-ordinated strike action in the run-up to the election provoked Blair to intervene. He instructed cabinet minister and former CWU union general secretary Alan Johnson to "defuse trades union anger" because "the negotiations were not working".

It is not accidental that former union leader Johnson was chosen for this task by Blair. Labour governments facing similar pressures in the past have co-opted union leaders into their governments in order to do deals which suck the unions into the government’s machinery.

Contrary to Prentis’ assertion, the reason that the unions have forced this retreat on the government has been due in large measure to the role of socialists in the PCS civil service union. Socialist Party members on the PCS NEC and PCS general secretary Mark Serwotka, in particular, along with others on the Left, have consistently pushed and developed a successful strategy for co-ordinated action by the unions.

Socialist Party members in other unions, such as UNISON, Natfhe and NUT, have been instrumental in galvanising the Left in those unions to push for co-ordinated action. And they have been the ones who encouraged liaising amongst the Left in the unions to work out a strategy that allowed right-wing union leaders little room for wriggling out of committing themselves to action.

The groundswell of anger from below has been turned into a concrete strategy for the biggest threatened industrial action for decades, forcing the government to retreat.

The Left in the unions now need to arrange a meeting where they agree a common strategy for the co-ordinated negotiations that the government has now conceded. This is the best way to ensure pressure is kept on the union leaders to press home the advantage.

At the same time, the unions should still look towards organising a national demonstration at some stage to mobilise all workers, private and public sector alike, to ensure that the working class as a whole is drawn into the campaign. It is little wonder that the bosses’ organisation, the CBI, accused the government of "backing down in the face of political pressure" and argued that it was "sending the wrong signal".

They are worried that other groups of workers, particularly those in the private sector who have seen their pension entitlements annihilated by their bosses in the last decade, will take heart from this enforced retreat by the government. They fear they will conclude that using the weapon of industrial action is the most effective way to win back their conditions.

Where workers in the private sector, like Network Rail and Rolls-Royce, have threatened strike action over pensions in the past, their bosses have beaten a hasty retreat.


But the ruling class and the government and employers will come back to this issue with a vengeance once the election is over. Their target is still to wipe out hundreds of billions from the public-sector pension bill and further weaken their commitment to providing state pensions and benefits for the retired.

Whilst for now the unions have kept their powder dry, workers must realise that this is a preparatory skirmish for the major battle to come. Nevertheless, the government has put itself in a much weaker position because of their hasty retreat. That means, however, that the government could be even more vicious when it comes back to the issue.

But, such is the anger of workers against the Labour government and the capitalist system on so many issues, pensions could be the catalyst for British workers to catch up with other workers across Europe in the scale and intensity of their industrial struggle.

Workers will draw confidence from this initial skirmish. The prospect of workers striking together has raised the sights of many in the workplace that the years of retreat – by the union leaders – can be reversed.

From a Special Supplement of The Socialist, paper of the Socialist Party, cwi in England and Wales

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March 2005