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The Fire Brigades Union

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Firefighters' Pensions Committee (FPC) established & chaired by the Office of ... Firefighter Magazine Specials, Circulars, Regional Mass Meetings, Regular ... – PowerPoint PPT presentation

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Title: The Fire Brigades Union


1
  • Pensions Crisis
  • The Facts
  • The Fiction
  • The Fight

2
  • 1. Background Information on Pensions
  • 2. Arguments for Change
  • 3. Proposed Changes to FPS
  • 4. Proposed Changes to LGPS
  • 5. Timeframes for FPS
  • 6. Timescales for LGPS
  • 7. Conclusions
  • Is It Legal?
  • 9. What Has Been Done So Far?
  • 10. What Can We Do Now?

3
  • Background Information on Pensions
  • Types of Pensions
  • State Pension Available to All
  • Private Pensions Private Sector or Individual
    Investments
  • Public Sector Schemes Civil Service, Teachers,
    Police, Fire Service, Health Workers etc.

4
  • Main Changes For Each Scheme
  • State Pension
  • Retirement Age
  • Private Schemes
  • Closure Final Salary Element
  • Public Sector Schemes
  • Retirement Age, Contribution Rates, Accrual
    Rates, Ill Health/Injury Benefits Closure With
    New Lesser Schemes

5
  • Firefighters Pension Scheme Local
  • Government Pension Scheme
  • Firefighters Pension Scheme
  • Open to Wholetime Firefighters Only
  • Unfunded
  • Is it Expensive?
  • Local Government Pension Scheme
  • Funded

6
  • Issues Common to all Pension Schemes
  • Mortality Assumptions
  • 30 Improvement in the 8 Years to 2002
  • Longevity Life Expectancy
  • Government Report states that
  • People are not paying enough Contributions
  • People are Living Longer
  • People are Retiring too early

7
  • Nearest Comparable Scheme to FPS
  • Police Pension Scheme
  • New Police Scheme for new entrants, with existing
    scheme ring-fenced
  • Fire Service only Emergency Service not being
    afforded the Protection of Ring-Fencing
  • Union Policy

8
  • 2. Government Arguments For Change
  • Affordability!
  • Flexibility!
  • Modernisation!

9
  • Phil Woolas Quote
  • "All public sector pension schemes are facing
    change and it is right that we modernise
    firefighters' pensions - the most expensive
    scheme in the public sector.
  • "We have carefully considered the responses to
    our pensions consultation and these proposals
    reflect the comments we have received,
    particularly the concerns of serving
    firefighters. We want a new scheme which is
    generous but affordable for both firefighters and
    the taxpayers that fund them and changes to the
    existing scheme which will help limit future
    costs.
  • "These proposals are in line with our aim of
    developing a modern Fire and Rescue Service and
    honour our commitment to introduce new pension
    arrangements. They also reflect changes in the
    new legal requirements, for example on pensions
    taxation."
  • Local Government Minister Phil Woolas
    September 2005

10
  • Responsibilities
  • Home Office Police
  • Department of Work Pensions Health, Teachers,
    Civil Service, Etc
  • Office of the Deputy Prime Minister Local
    Government (LGPS) Firefighters (FPS) Schemes

11
  • 3. Proposed Changes to FPS
  • ODPM Consultation Exercises
  • Existing Scheme (FPS)
  • New Scheme (FPS)
  • Still Awaiting Detailed Consultation
    Documentation from ODPM on Injury/Ill Health
    Retirements, (due since 14th January 2005)

12
  • ODPM Proposes To
  • Amend The Existing FPS Scheme For All Existing
    Members.
  • Introduce a New FPS Scheme For New Entrants

13
  • Eligibility For The New FPS Scheme
  • New Wholetime Firefighters.
  • New Existing Retained Firefighters
  • Existing Wholetime Firefighters Who Choose To Opt
    In.
  • Control Staff Are Deemed Ineligible!

14
  • Main Changes
  • Retirement Age Accrual Rates
  • Transitional Arrangements
  • Deferred Pension
  • Ill-Health Retirement
  • Higher Tier with enhancement
  • Lower Tier without enhancement
  • Survivor Pensions
  • Death Benefit

15
  • Example 1
  • If a member reaches the age of 50 to 55 and has
  • attained a minimum of 25 years pensionable
  • Service, but not 30 years, they will be able to
  • retire on pension.
  • The Pension calculation, however, would be split
  • between pre and post 1st April 2006 service.
  • The pension for pre 1st April
  • 2006 will be unreduced.
  • Contd

16
  • Example 1 (contd)
  • However, the Pension post 1st April 2006,
  • will be reduced, by 5 for each year,
  • between age of retirement and age 65 (deferred
  • pension age)
  • Scenario
  • A member retires at 50 with 25 years
  • pensionable service. The post April 2006
  • Pension will be reduced by 75, (15
  • Years x 5 )
  • 5 is the Government Actuary figure

17
  • Example 2
  • A Member with 30 Years pensionable service
  • completed by age 50, continues to work until age
  • 55.
  • Accrual Rate 1/60th per year for years 1 20.
  • Fast Accrual rate 2/60th per year for years 21
  • 30.
  • Members can though, now accrue up to a maximum
  • of 35 years pensionable service.

18
  • Example 2 (cont)
  • Accrual rate for last 5 Years (or part thereof)
    is
  • 1/45th (equivalent to 1.33/60th)
  • Therefore with 35 years pensionable service
  • achieved, the pension will be 35/45th of final
  • pensionable salary, (equivalent to 46.7/60th)

19
  • Example 3
  • Member continues to work to age 50, and after
  • 30 years pensionable service in existing scheme,
  • joins the new scheme.
  • At eventual retirement age the pension would be
  • 40/60th plus 1/60th for each completed year of
  • pensionable service in the new scheme.
  • Accrual Rates 40/60th 5/60th 45/60th
  • Reason for Choice? Possible lower contributions
  • would boost members take home salary.

20
  • 4. Proposed Changes to LGPS
  • Removal of the 85 Rule
  • this would increase normal retirement age from 60
    to 65 and
  • raise the earliest retirement age from 50 55,
    excluding Ill Health
  • Increased contribution rates (currently 6) to a
    range between 5.5 9 (dependant on earnings)
  • Restrict Pensionable Pay (basic salary, excluding
    allowances)
  • Ill Health Retirements
  • Two Tier System

21
  • Two Tier Ill Health Scheme proposals intended to
    differentiate between
  • 1. Those that are permanently incapable of
    performing any gainful employment and
  • 2. Those incapable of continuing in their current
    role, but capable of other gainful employment.
    (Pension based on length of service only)
  • NB Only those in the first category would be
    eligible for an enhanced pension.

22
  • 5. Timeframes for FPS
  • ODPM Plan To Close Membership Of The Existing
    FPS Scheme Open The New Scheme on

1st April 2006
  • It is Still Possible that Timeframe May Slip
  • It Is Possible That Different Timeframes will
    Apply Across The UK.
  • ODPM Still Have Yet To Publish Ill Health/
    Injury Proposals

23
  • At This Time We Must Assume, that ODPM Will Try
    To Meet Their 1st April 2006 Timeframe For The
    Implementation of a New Scheme and Changes to the
    Existing Scheme.

24
  • 6. Timeframes for LGPS
  • Government decided not to proceed with changes to
    LGPS in April 2005
  • just prior to the Election, and in the face of
    Public Service Strike Threat
  • Government said they intended to seek further
    consultation with key stakeholders
  • the Pensions Green Paper proposals are intended
    to be implemented at the beginning of April 2006

25
  • 7. Conclusions
  • The proposals will effect different Members in a
    variety of different ways. This will be dependent
    on the members
  • Age
  • Length of Service
  • Duty System Worked
  • Role
  • Health
  • Family Circumstances

26
  • 8. Is it Legal?
  • Government Consultation
  • Fire Rescue Services Act 2004
  • No Protection for Accrued Rights
  • Superannuation Act 1972
  • No Protection for Accrued Rights
  • Human Rights Act 1998
  • Peaceful Enjoyment of Property
  • Protection for Accrued Rights Prior to Changes
  • Protection for Future Service Benefits?
  • Seeking QCs Opinion

27
  • 9. What has been done so far?
  • Firefighters Pensions Committee (FPC)
    established chaired by the Office of the Deputy
    Prime Minister (ODPM)
  • FBU Responses in Consultation Process
  • Lobbying Politicians
  • Press Media
  • Campaign to inform Members of issues
  • Firefighter Magazine Specials, Circulars,
    Regional Mass Meetings, Regular Reports through
    the Committee Structures, Press Media

28
  • 10.What Can We Do Now?
  • FBU Conference Policy
  • Members must decide
  • Accept or Fight?
  • Keep up to Date with the Issues
  • Ensure regular attendance at Branch Meeting,
    Read All Literature produced by the Union watch
    the Press Media coverage.
  • Lobby your MP, both individually collectively,
    as a Branch
  • Discuss Debate with other members - Regularly

29
  • Over 1 Million Public Sector Worker Affected
    Voted YES in Strike Ballots last year.
  • The TUC is still campaigning at Government level
  • Other Unions involved in LGPS talks
  • GMB, TGWU, UNISON, NAPO, AMICUS, UCATT, CYWU
  • Coordinated action is still a possibility.
  • WE ARE NOT ALONE

30
  • Its your Pension
  • Its Your Future Financial Security
  • Its the Financial Security of your Families
  • Fight To Keep It
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