I should probably comment on here about the strikes of yesterday. That is, something likie 750,000 public sector workers going on strike about pension reforms.
I'm a product of our education system here, and certainly those that study economics at A-level I think come out with a rather odd internal inconsistency. They tend to be anti-market, but also anti-union, and from reading the essays of my students this year, I think that hasn't changed.
However, after pondering it, I am with the strikers. I've said it before, and I think it well and truly applies here: The Tories are remarkably good at propaganda. For all the criticism Labour got while in power for spin, the Tories really are the masters at this. They managed to convince the public that Britain was essentially becoming Greece and that austerity had to happen, and even as we lurch into a prolonged depression people still blame Labour for it (austerity, that is).
Why do I say this? Well, this little exchange between Evan Davis and Francis Maude. It shows the height of the Tory misinformation campaign - present the current system as unaffordable; have people go on the radio repeating this ad infinitum, and soon everyone will believe you. Certainly, everyone I've chatted with about this has presented this idea. But as Evan Davis points out, somewhat flippantly, is that this is not what the Hutton Report says, the report that the government is trying to use to justify the pension reforms. In fact, as things stand without reforms, the share of GDP going to public sector pensions will fall over time. How about that?!
Then on top of this, there's the fact that MPs also get pensions twice the size of teachers' pensions, and I think you can start to see why I'm supporting the strikers.
The only other argument I haven't addressed is the supposed "fairness" of public pensions vs private pensions. Comparisons abound about pay in the public and private sectors and almost all of them have a political angle, as Tim Harford pointed out on Radio 4 a week or so ago. How do you compare the different skill levels, different experience levels, plain different types of jobs in the two spheres? Are teachers really much better paid than their private equivalents (I doubt it), and if not, are they really that much worse than their private equivalents? Teachers tend to work investment banker style hours and get anything but an investment banker salary for much of their working lives. Why shouldn't they thus get a somewhat generous pension as a result of this? What is "fair" about cutting that pension, exactly? Don't we want to be attracting people into the teaching profession? The bottom line is that money talks and proposing to cut back an affordable-and-not-spectacularly-generous-relative-to-MPs pension system doesn't seem like the way to keep attracting people in...
Essentially, there's no pressing need to reform the pensions since they aren't unaffordable, and if there is a villain around, surely it's the self-interested politicians not interested in reforming their own system.
I'm going to disagree with you.
ReplyDeleteIn the past, public sector workers got paid less than the private sector. This was compensated by better job security and a well funded pension scheme.
Since the Unions started arguing over pay, the public sector wages have now surpassed the private sector wages yet there is still the better job security and nice pensions.
In general, the private sector pays for the public sector from taxes. Surely you must be able to see that the private sector is generally fed up with paying higher taxes in order to keep the public sector financed when they cannot afford to offer similar schemes themselves?!?
While I think it may be a little harsh to make the teachers et al have that many changes at once, they certainly get paid more than me and have a rather large amount of flexible working time (holidays).