The UK’s latest pensions scandal is brewing – can Burnham fix it? (Image: Getty)
It’s a shambles which puts the livelihoods of millions of pensioners in jeopardy – and it has to be one of our new Prime Minister Andy Burnham’s first jobs to fix.
While this week the OECD warned of the risk to spending caused by the state pension triple lock – itself a difficult problem to solve but one pensioners feel strongly should remain in place – another pension problem is going under the radar.
The UK’s Civil Service pension scheme is a shambles right now and it’s the latest example of the UK government dumping public sector schemes into private ownership and the whole thing ending badly.
This week, the Express spoke to Civil Service employees set to retire or already retired who still have no idea how much their pension is worth, and when they will get it, despite having paid into it for decades. They are some of the thousands of civil servants up and down the country who are heading into retirement without the public sector pension payments they’re owed from the money they paid in from their own hard work.
Capita has warned over an earnings hit of up to £40 million this year due to a raft of contract failures on the UK’s Civil Service pension scheme. The firm faced a grilling from MPs in a Commons committee hearing last Wednesday, with chief executive Adolfo Hernandez reiterating apologies for delays in administering the 1.7 million-member pension scheme, which has left thousands of civil servants waiting for payments and retirement quotes.
Make no mistake. Just like selling off the water companies, who have then collectively failed to build a single reservoir since 1992, privatising the trains, with firms then running ancient services with constant price hikes, and flogging Royal Mail (no comment needed here), handing control of public pensions schemes to the private sector patently hasn’t worked. In fact, it is the latest in a long line of very public private failures.
In June, the government said ‘all options remain on the table’ in future if Capita fails to meet its deadlines.
It’s a lever Andy Burnham will need to pull fast if he doesn’t want an angry, WASPI-style pensioner uprising in his first months in office.
While needing UK PLC to remain open for business, a key challenge of his time in office will be pulling apart failing privatisation without scaring away future investment into the UK.
Is Andy up to the task? The answer will be made very public, especially if pensioners are left without their hard-earned cash.