By John Knox
Now is the winter of our discontent. It began on St Andrew’s Day and who knows when and where it will end.
They came in their thousands, bearing the saltire and the green and white flag of the “Protect our Pensions” campaign. They marched down the Royal Mile to the Scottish parliament in the largest demonstration ever seen there, 7,000 strong.
Instead of a pipe band, they brought their own green plastic hunting horns. Most were middle-aged, respectable-looking people – teachers, nurses, council workers. Many brought their children because the schools were closed by the national day of action. An estimated 300,000 Scots were out on strike, two million across the UK. It was first national strike for 30 years.
The marchers were served curries from a mobile kitchen, rather than pie and chips. They were greeted by pop music, rather than a brass band. But there were the traditional angry speeches from the platform.
There was no great crowd to watch the march-past. MSPs were divided as to what to do. Labour and the Greens joined the march, the SNP, the Tories and the Liberal Democrats stayed holed up in their spiky parliament building, earnestly debating the pensions issue, and no doubt wringing their hands. On the Royal Mile I heard a lady cyclist complaining the marchers were delaying her getting to work. The Queen’s Gallery stayed bravely open for art lovers and well-heeled coffee drinkers. The exhibition was ominously entitled “The Northern Renaissance”.
So has the government misjudged the pensions issue? Will it turn out to be the poll tax of our times, the final insult that drives the people to revolution? Public sector workers are already seeing their jobs go – 700,000 over the UK in next three years. They learnt in the chancellor’s autumn statement on Tuesday that their wages, currently frozen, will be subject to a 1 per cent cap over the next two years.
All this is taking place under a gloomy economic sky, with growth forecast at just 0.7 per cent next year, unemployment at a 17-year high, inflation at 5 per cent, the banks still in trouble and the euro on the edge of meltdown. This is indeed an Age of Austerity and it is expected to last for years.
The immediate issue is the reform of public sector pensions. It is a complicated business – but, as I understand it, the government is saying that employees need to pay 3.2 per cent more in contributions, receive lower career-average pensions, and the retirement age should be raised to 67 (in 2026) if the system is to be sustainable. People are, after all, living much longer and the government, as the employer, cannot afford to raise its contributions. That, it says, would be unfair on the taxpayers – who, by and large, do not have such generous pensions.
On the other side of the barricades, the unions are saying that the public pension funds are currently in surplus (£2 billion in the case of the NHS and £300 million in the case of local government) and the 3.2 per cent increase in contributions is going straight to the Treasury to help pay off the huge national debt run up by the banking collapse. As in Ireland, Greece, Italy, Portugal, Spain and Iceland, ordinary workers are asking why they should be made to pay for the misdeeds of the bankers, especially when there is no sign of fat-cat pay or bonuses being brought back to earth.
David Cameron says the day of action was a “damp squib”. The unions say it was the biggest demonstration of public anger for a generation. No one knows how this battle of wills will be fought out over the coming months. But for me it has distinct echoes of the old class wars. Gordon Brown was accused of raiding the pension funds of the middle classes with the abolition of tax credits on dividends. The Tories and the Liberal Democrats are now accused of raiding the pension funds of public sector workers. We are falling back into a divided Britain and the Age of Contentment is over.