A 'Damp Squib'?
Hundreds of thousands of public sector workers went on strike in Britain on Wednesday to protest over pension reform, in a walkout billed by unions as the biggest in a generation but derided by Prime Minister David Cameron as a "damp squib".
Unions and the government were each quick to claim victory, with labor leaders saying up to two million teachers, nurses, border guards and other workers took part. The government disputed the turnout and played down the strike's impact.
"Our rigorous contingency planning has been working well. Throughout the day it has limited the impact of the strikes significantly and as a result the majority of key public services have remained open," said Cabinet Office Minister Francis Maude.
The government said the unions' turnout claim was "wrong" and the true figure was "significantly less." Cameron described the strike "something of a damp squib."
Unions hit back, reaffirming their two million figure and rejecting again government public sector pension reforms they say will force people to work longer before they can retire and pay more for pensions that will be worth less.
The government, trying to turn around a debt-laden economy teetering on the brink of recession, says reform is needed as people are living longer and public service pensions are unaffordable.
"Government rhetoric today is as predictable as it has been shallow," said Brendan Barber, general secretary of the Trades Union Congress, Britain's main union umbrella group.
"The biggest strike in a generation cannot be dismissed as a damp squib. The (government) claims that all low paid workers will be protected and that the average workers will get better pensions collapse under the slightest scrutiny," he added.
Union anger has been fuelled by new curbs on public sector pay and hundreds of thousands of additional job cuts outlined on Tuesday when the Conservative-led coalition government cut economic growth forecasts and said its tough austerity program would last until 2017.
The power of Britain's trade unions was curbed by Margaret Thatcher's Conservative government in the 1980s, but the public sector remains one of their strongholds.
Unions are threatening further strikes next year if the dispute is not resolved but analysts say a repeat of the 1979 "Winter of Discontent" that helped Thatcher sweep to power is not on the cards.
"It's very different to the 1970s and 80s. Many of the services that were run by the public sector have been privatized," said Tony Travers, a public finance expert at London School of Economics.
"There is not much evidence that rank and file union members want to go on long-term strikes," he added. "The unions have the power to make a fuss and wound but not kill."
Protests held in towns and cities across Britain mirror strikes in other European countries, where governments are trying to juggle budget deficits with the needs of an ageing population.
"Why are the government picking on us in the public sector?" asked Kevin Smith, 54, picketing in pale winter sunshine outside parliament in London, where he works as a security officer.
"We had no rise the last two years, before that we were getting lower than inflation rises. So how long is it going to last?"
Inflation stands at five per cent, far outstripping pay rises for public and private sector workers in a squeeze on living standards that is depressing consumer spending.
The government insists its pension reforms would give public sector workers a better pension than most in the private sector. Some private sector workers had little sympathy for strikers.
"Get back to work and get a maths teacher to give you a lesson. There is no money," said Benedict Crabbe, 38, an investment manager from central England in London on business.
Retail centers in London and Manchester enjoyed a boost as parents looking after school-age children did some Christmas shopping.
Fears of long delays at London's main Heathrow airport proved unfounded after the government flew home embassy staff to help out and recruited volunteers from other departments to carry out passport checks.
However, underground rail services were not running in Scotland and there were no trains or buses in Northern Ireland.
A coalition of 30 trade unions are took part in the strike, billed as the biggest walkout since 1979.
Speaking earlier at a rally in the central English city of Birmingham, Barber told Reuters more strikes could follow.
"We will have to see, we want to resolve these negotiations by the end of the year, the government's self-imposed deadline," he said. "I hope it will be possible to resolve it, but if not there is then the prospect of further action including days of this sort."
Meanwhile, the man behind pensions reform slammed the public sector strike as 'unjustified':
I happen to agree with many of Lord Hutton's points. He's is absolutely right that pensions do not come for free and that societies across the world will face the challenges of increasing life expectancy and the needs of an ageing population. And people will need to save more to diffuse the pensions timebomb.
The man who has been guiding the Government on sweeping pension reforms has slammed this week’s public sector strike, saying there was no justification.
Speaking on a visit to the city to deliver the Birmingham Forward Roger Dickens Annual Lecture at the CBSO, Lord Hutton of Furness also called for energies to be focused on dealing with the problem of pension provision in a rapidly ageing society.
“I don’t believe there is any justification for a strike,” he said. “It will cause a massive amount of inconvenience.
"There is nothing good about this. There is a perfectly good offer on the table that will still see a perfectly good pension for the future.
“I would much prefer people to be talking about that rather than rhetoric about strikes and disruption to society.
“Strikes don’t make the problem of life expectancy go away. We have to have a debate about the costs. At the moment it is all being made by the taxpayer and that is not right or sustainable.”
He also called on all parties involved in the dispute over pension reforms to continue to negotiate, believing a more than fair offer has been made to public sector workers.
He said: “I’m not party to the negotiations but I think there is a very generous offer on the table – in many ways more generous than my report – and I think there is a deal to be done. I just hope the talking starts as soon as possible as that is the only way to resolve it.”
Lord Hutton’s Birmingham Forward lecture addressed the problems of Britain’s ageing society, something he feels has to be faced up to, even if difficult decisions have to be made.
“We have reached a point where we need to have a more general discussion about the impact of increasing life expectancy and the implications of becoming an ageing society,” he said.
“There is a sensible way forward but it does involve people making some hard choices and changing our assumptions about working life and the environment in which we live.”
As well as working later and being expected to pay more into the country’s pension pot, Lord Hutton believes society as a whole must also change.
“The challenge for the Government is what are the implications for the health and social care system, the labour market and housing. My speech in Birmingham highlighted some of these challenges.”
He added: “The pension system is most obviously experiencing the sharp end of the spear but you can see the implications coming through the social care system. How do we provide good quality care for rising number of old people who need it?”
Painting a grim picture of the situation we face now, Lord Hutton also warned it could get worse unless action is taken.
“The current system is broken and we can’t go on the way we care for the health needs of older people,” he said.
“We are going to need big changes in the health system, more support for people to remain independent in their own home and get away from the model of care that assumes when you get old you need to go into hospital.”
However he remains optimistic Britain is more than up to the challenges ahead, given the country’s history of innovation and problem solving.
“I think there is a huge challenge which is coming down the track for us but this is the nation which developed the welfare state and we can rise to the challenge but we have to think very carefully about it.”
He also believes it is a problem for society as a whole, rather than just the Government.
“At the moment we are not doing the thinking,” he said. “It is a big challenge for our society and our government. We really do need a big change in attitude. It’s a big problem for the private sector too and the charitable sector.”
Pointing to statistics at just what Britain’s rapidly ageing population will mean in real terms, Lord Hutton added: “There is a growing number of people aged over 100, by the end of the century it will be equivalent to the population of Birmingham – and that is a conservative estimate.”
Having said this, where I disagree with the Lord Huttons of this world is that they only focus on costs in a narrow sense and place too much of a burden on individuals to save more and bear the brunt of their retirement security. If you look at the trend around the world, there is a concerted effort to weaken unions in both public and private sector, to dismantle 'costly' defined-benefit plans and replace them by 'cheaper' defined-contribution plans. And with the introduction of new austerity measures, pension retirement age is rising, wages frozen or slashed, and benefits are being cut. This will accelerate pension poverty and lead to higher social costs down the road, something that the Lord Huttons of this world conveniently ignore.
In short, there is a full-fledged war on labor. That is what the 'debt crisis' in Europe and elsewhere is really all about. Intelligent money managers like Bill Gross understand this and have openly decried it. They understand why people are hopping mad. And what's worse in all this is that while the banksters get away with murder and continue to profit by obtaining money for nothing and risk for free, the rest of the sheeple are asked to work longer for shittier pensions and bail out these sociopaths every time they screw up.
And while I understand the resentment of private sector workers toward public sector workers, they should be more mad at why their pensions were so badly managed, that their inflation measure was changed and why they're asked to accept the short end of the stick by going into defined-contribution plans. In my mind, along with employment, pension sustainability will be the political issue of the future. It already is. And in order to make pensions more sustainable, we need to get the starting point right, which means defined-benefit plans for both public and private sector workers. That is the only long-term solution to secure retirement for workers and avoid the costly plague of pension poverty.
Finally, while there is a possibility of reaching a deal on public sector pensions, I'm concerned about how British pension funds are being coaxed into investing in infrastructure. Instead of taxing the banksters, the government is raiding pension funds to shore up their spending on infrastructure projects. So was this massive strike a "damp squib"? I think not. People all around the world are realizing that the truth is being concealed by lies, damned lies and statistics. Below, watch the IBN Live report on the biggest mass strike in 30 years.