Government staff will have to work longer – just like the rest of the public – if the pensions shortfall is to be plugged.
Chief Minister Allan Bell has called for calm in what he says has been an ‘hysterical’ debate over public sector pensions.
There has been public outcry after plans to raise the minimum retirement age for public sector staff to 58 were dropped – on the same day it was announced the rest of us will have to work longer to collect our state pension.
Former Policy and Reform Minister Chris Robertshaw MHK, who quit his cabinet post in protest at the pace of change in government, has called for an emergency debate on the issue in Tynwald this week, arguing that the Public Sector Pensions Authority should think again.
Chief Minister Allan Bell said the announcements’ timing was ‘unfortunate’. ‘That’s an understatement. It wasn’t helpful,’ he said.
But he added: ‘The debate is getting hysterical. It is not a simple problem to resolve. There are no simple solutions. We can’t just magic it away by a lot of shrill political voices.’
Mr Bell suggested raising the retirement age for public servants would come back on the table in due course.
He said: ‘A Tynwald working group is looking at possible solutions including increasing contributions and in due course there will have to be a rise in the retirement age. We are all going to have to work longer, there’s no option.’
The Prospect union will not negotiate until it has seen evidence for the need to change the unified scheme, which was only introduced in April 2012.
Mr Bell said cutting the size of government meant the shortfall, now £30m and rising, had increased in the short term as contributions were less and lump sums paid out in many cases.
‘That was always anticipated. What was not anticipated is the numbers who opted for early retirement,’ he said.
‘The projected figures have not turned out quite the way we hoped and this must be revisited in a realistic but balanced way to a find a new direction to make sure the deficit is reined in as soon as possible.
‘That can only come from working longer and increasing the size of the working population.’
Minister for Policy and Reform John Shimmin MHK, who chairs the PSPA’s pensions committee, said: ‘Although the timing was totally unintentional and outwith my control, it has always been necessary that these issues become more widely debated.’