Teachers’ Superannuation (Scotland) Amendment Regulations 2014 (SSI 2014/44)
Good morning and welcome to the eighth meeting in 2014 of the Education and Culture Committee. I would be most grateful if everyone present could switch off all electronic devices, as they interfere with the sound system.
The first agenda item is a briefing on the Teachers’ Superannuation (Scotland) Amendment Regulations 2014. I welcome to the meeting Michael Russell, the Cabinet Secretary for Education and Lifelong Learning; Chris Graham, from the people and leadership unit in the Scottish Government; and Chad Dawtry, from the Scottish Public Pensions Agency. The briefing provides members with an opportunity to hear from the cabinet secretary and his officials about the regulations. The debate on the motion for annulment will be taken as a separate item afterwards, and only MSPs may take part in it.
I invite the cabinet secretary to make some opening remarks.
Thank you, convener.
I appeared before the committee almost exactly a year ago to speak to a similar SSI and motion and, at the time, I declared an interest at the opening of proceedings. I will do so again this time round. A year ago, I referred to my wife as a prospective pensioner. As she was not entirely happy with that reference, I will try not to repeat it, but I should declare that she is a teacher who makes contributions to the Scottish Public Pensions Agency.
I am no more pleased to appear before the committee to discuss this issue than I was last year. I am, of course, always pleased to appear before the committee, but I have to say that I do not speak in support of these regulations with any great enthusiasm. Unfortunately, however, they are once again necessary.
I reiterate the Government’s commitment to public service pensions that are affordable, sustainable and fair, both for public servants and for the communities that they serve, and I again put on record our recognition of the hard work and considerable achievements of the teachers and lecturers who deliver high-quality education to children and young people across Scotland.
The general context—the Westminster context—of wage restraint and financial hardship in which we have had to apply previous increases to teachers’ pension contributions, alas, still exists. Despite that, the United Kingdom Government continues to force us to make further increases, and is able to do so because of the current constitutional arrangements under which the Government at Westminster sets the basic terms for the pensions of most of the people who provide public services in Scotland.
Her Majesty’s Treasury is still determined to raise more than a quarter of a billion pounds of extra revenue a year from the pension contributions of teachers, police officers, firefighters and national health service staff in Scotland, and the UK Government would still impose its punitive financial penalties on Scotland if we did not deliver that additional income. It gives us a simple but unwelcome choice: force public servants to pay yet higher pension contributions or have less money to pay for the public services across Scotland that they deliver.
We are in a slightly better position this year—it is only slightly better—in that the level of increase that is required by the Treasury is only half of what was required in each of the previous two years. That means that it is threatening to reduce the Scottish budget by only around £50 million per annum in perpetuity if we do not meet its demands, which is a very small mercy for which to be grateful. The illustration that I gave to the committee last year is still revealing. More than a third of that £50 million reduction—almost £18 million—would be attributable to teachers’ pensions. That is the equivalent of just under 500 teachers.
Therefore, the reality is that we cannot impose such a burden on Scottish education and Scottish communities. We have no choice other than to implement employee pension contribution increases in the public sector for a third year, from April 2014. That is why we have reluctantly brought forward the regulations that the committee is considering this morning. As in previous years, we are seeking to apply the increases fairly by asking those who earn more to bear a greater proportion of the burden. That is consistent with our approach in previous years and, as in previous years, it mirrors the distribution of increases in England and Wales.
That is all that I need to say by way of introduction. I stress that it is with no little reluctance that I commend the regulations to the committee.
Thank you very much, cabinet secretary.
I will begin with a technical question that was raised by the Delegated Powers and Law Reform Committee about the delay in laying the regulations. Could you clarify what happened?
I will ask Mr Dawtry to do that. I think that there is an explanation.
There was a regrettable delay between the signing of the regulations down south by Her Majesty’s Treasury commissioners and the Treasury telling the Scottish Government that the regulations were ready to be laid. I believe that my colleagues in the legal directorate made that clear to the committee and offered our apologies.
Thank you very much for that. I just wanted to clear that up.
You said that you were “no more pleased” to bring forward the regulations that we are considering today than you were to bring forward last year’s regulations. How has the Scottish Government engaged with the UK Government to prevent or mitigate the increase?
As I said in reply to your colleague Mr Findlay last year, there has been regular and intensive engagement. It is no secret that we do not want to increase pension contributions. The answer has been the same—it has been, “Either you implement this or you get the money cut.” That will not change, no matter how often we ask the questions. The reality is that that is the UK Government’s position. It has not shifted from that position and it shows no willingness to do so.
Why has the Scottish Government made proposals to pass on UK Government cuts to teachers’ conditions? You have found money for the white paper and discretionary housing payments, so why can you not find additional money for teachers’ pension contributions?
Those are two different things, of course. It is interesting that you mention discretionary housing payments, which mitigate the effect of decisions that Westminster has taken. Were we not to proceed with the regulations, we would have to mitigate the effect of another Westminster decision, and we cannot go on doing that, particularly when we would have to do so in perpetuity—the £18 million that we would have to find this year would not be a one-off; it would be money that would have to be found for ever. The equivalent of around 470 teachers would require to be paid for for ever, which is clearly not feasible.
Of course, there is a solution—the solution is to make all the fiscal powers available to the Scottish Parliament.
Unlike your wife, I am a pensioner.
I am surprised by that information.
I thought you would be. I declare that interest and refer members to my entry in the register of members’ interests.
I was looking back for some information on pensions in Scotland and I found that the most recent Audit Scotland report on the subject was produced in February 2011, so I appreciate that my figures are a bit out of date. The Auditor General for Scotland looked at the schemes for local government, the national health service, teachers, the civil service, the police and firefighters. I appreciate that there are differences between those schemes—for example, the local government pension scheme is funded.
At that time, the pension scheme that was most in the red was the teachers’—it was £240 million in the red. There were 59,000 pensioners and dependants and 27,000 deferred members in the teachers’ scheme, and 78,000 people were paying into it. Given that the teachers’ pension scheme was £240 million in the red that year, how could it continue at the same level of contributions if it was to be affordable, sustainable and fair? Where should the burden fall if not on employers’ and employees’ contributions?
It might be helpful if Mr Dawtry explained the technical side of the schemes, and then I will be happy to pick up any political point.
It is worth pointing out that there are more up-to-date figures in the public domain—
I appreciate that.
The Scottish Government also published on 23 September a paper entitled “Pensions in an Independent Scotland”, which gave figures for all the schemes, including smaller non-departmental public body schemes, from the end of March 2012.
With regard to the figures that you have referred to, I understand why you might take that position on the cash-flow difference between the money being paid in and the money being paid out, but it is also important to remember that the money that is being paid out is being paid out to today’s pensioners under yesterday’s pension promises. They have already paid into the scheme, and their pensions are being paid out. As today’s contributions are being made on behalf of current active scheme members for future pensions, the comparison is not always a fair one. You are almost comparing two different generations of public sector pension scheme members.
I acknowledge that the figures that I have are out of date; I was the deputy convener of the Public Audit Committee, so I had this report in my office. If the scheme was £240 million in the red in February 2011, in what state were the scheme’s finances in September 2013? Was the scheme still in the red, or was it in the black?
On the basis of cash flow—in other words, the money that is coming in versus the money that is being paid out in pensions, although we should bear it in mind that those two things are not really connected—I have to say that the scheme is still in an annual cash-flow deficit. The important facts about a pension scheme are those given in actuarial valuations, which look at the scheme’s life over the next 40 to 60 years or the period over which the liabilities that are built up are defrayed and the contributions for those liabilities are made.
I am comparing the scheme with other schemes that the Auditor General examined at that time. The local government scheme had a £266 million surplus, the NHS scheme had a £222 million surplus, the civil service scheme was in the red by £38 million and the net cash flow for the police and fire schemes stood at zero. At that time, the teachers’ scheme was actually in the worst state of those on the books. I am simply saying that the Auditor General compared the scheme with other public sector pension schemes and highlighted it as an issue. Do you think that, in the long term, it fares worse with regard to affordability and sustainability than the other pension schemes that the Auditor General compared it with?
No. Under the narrow measure of cash flow, it does, but I point out that a number of public sector schemes are also in deficit. As you will be aware, there has been a programme of reform of public sector schemes, but I would not say that the teachers’ scheme is necessarily faring any worse in the long term with regard to sustainability and affordability.
I am just slightly concerned by the matter. It is only my third week on the committee, but I understand that contribution rates changed to a tiered system from April 2012 to March 2013 and then changed again. Given that contribution rates have increased, I am surprised that, as far as cash flow is concerned, the scheme is still almost a quarter of a billion pounds in the red. Can you confirm that that is the case?
I understand your concern. However, I point out that if the pension scheme were to be closed today and no more contributions made, the contributions that are being paid today would still have to be paid and the deficit would be bigger. Cash flow is not the perfect measure for deciding whether a scheme is affordable and sustainable.
I am only going by what the Auditor General has said. If the payout is £756 million and the total contributions in a year amount to £516 million, the remaining £240 million has to be met from revenue from general taxation. Is that correct?
Yes.
So, unlike the situation with other pension schemes, taxpayers are having to find £240 million every year to fund the teachers’ pension scheme.
Every year the Government has to honour previous promises, and there is an imbalance in that respect.
And that quarter of a billion pounds is being taken from other budgets.
It is being taken from the Scottish budget.
Thank you.
And this motion is asking us to do more. Last year, if I remember correctly, your predecessor on the committee supported it. I think that there was a slight inconsistency in that position.
However, I think that what we are seeing here—
Excuse me, you do not know what I am going to support today.
Indeed, and I am agog to see what you will do.
I am sure.
As ever, Mrs Scanlon. I am always agog to see what you will do next.
I am so unpredictable.
10:15
Indeed. I just want to make it clear that, as it operates at the moment, the scheme is affordable. The decisions that have been made by the Treasury are to do with public expenditure cuts. They were not made because the scheme is not affordable. Even the Treasury will admit that.
What we are talking about here is, if I may put it this way, an ideological approach to the matter that has come from south of the border. The pressure is on us to decide whether to follow suit, and the argument that I am making is that, regrettably, we have to follow suit, because we will be faced with a penalty otherwise, and that is what is at stake.
I have a final question.
Well, it must be a very short one.
How can the scheme be affordable when £240 million is being taken from other Scottish Government budgets to finance the essential payments?
A review and valuation is due later this year.
Yes.
We would only be able to make the decision that you are asking us to make—
I am not asking you. I am just looking for clarification.
We would be able to make the decision that you suggest—that you might be suggesting; I am still uncertain of your position—only once we had an actuarial valuation of the scheme over the long term, and we do not have that.
Well, you were asked to make that decision in 2011, but there you are.
Good morning. Cabinet secretary, the Educational Institute of Scotland has described the increase in pension contributions as an “austerity tax” on hard-working teachers. What do you say to that union’s membership in response?
I advise them to look at “Scotland’s Future” about the future of Scotland and Scotland’s independence; I advise them to turn to page 138 and the following pages and look at the positive proposals on pensions; and I advise them to vote yes in the referendum, because then we will not have to come back and have this argument again.
Thank you.
Good morning. I will follow up Mary Scanlon’s line of questioning. This question might be one for Mr Dawtry. You have helpfully explained how the funding of pension schemes operates. I presume that, when the Auditor General set out the figures, he would have been aware of that. Were representations made to the Auditor General at that stage that how he was characterising the position of the pension scheme for teachers was unhelpful or potentially misleading?
We worked fairly closely with the Audit Scotland team that worked on this, and we would have made the point that cash flow is not the only or perfect measure of the sustainability or affordability of a pension scheme.
But it is a measure of it, and I suppose that the charge that is being laid at the door of successive Governments is that taking comfort from the notion that it has aye been thus and that we can play catch-up in due course has led to pensions reform being put off again and again.
I suppose that this question is more for the cabinet secretary. Your explanation of where we are with the pension scheme would almost provide succour to those who are faced with the difficult decision about what to do with pensions. One could get around to dealing with the shortfall that Mary Scanlon identified—and I accept that the cash position is not the only measure—but it could be put off until another stage. Is that correct?
I certainly think that there is a need to discuss constructively and intensely the issue of pensions in Scotland. It is a two-stage process. The first stage is to bring back to Scotland the power to run and make decisions on those schemes. That is an important step.
Thereafter, the proposal in the white paper for a commission on pensions is how we would discuss the overall issue of public sector pensions. That is a good model to go on. It does not apply just to the question of how much is paid; it applies to the question of when it is paid.
I think that the EIS—I have no wish to misrepresent its position—is, like me, in favour of maintaining the retirement age at 65. I think that most members on the committee with any knowledge of teaching would say that carrying on teaching until 67 is unacceptable. The commission is an important step forward, but what is required first is to get back to Scotland the power to make decisions on pension schemes. We do not have that power or, rather, the power that we have is so circumscribed by the financing and by the Treasury that it is not a power at all.
Is that not the problem with the advice that you have just provided to Jayne Baxter? You said that teachers should look at what is set out in the white paper but, from page 123 onwards, they will find a lot of promises but no calculation of the cost or what other compromises would need to be made to deliver something of greater value or benefit to teachers. Is that not the case?
The white paper is rich in information, as you are aware.
It is not so rich in figures.
It includes very substantial financial information in the second section that looks at the balance sheet. Pages 138 and onwards are clear about the need to take an overall view of public pensions and to make sure that decisions are made across the public sector. That is the right next step. Mr Bibby’s motion is helpful because it allows us to focus on that issue. Consequently, we can ask ourselves what is the right way to move forward. The right way is to ensure that the pension scheme is run and the decisions are made in Scotland. By doing that, we can integrate the thinking on pensions across the public sector. That is a very positive thing to do.
That may be a fair assessment but, as you have indicated, your desire to spend more in that area will constrain the amount that you can spend in another area. The white paper rather unhelpfully glosses over that matter. The more up-front information about where the additional funds would come from in order to secure a more generous settlement for teachers or other public workers is sadly lacking.
The word “generous” is an unfortunate one to apply, for example, to the requirement for teachers to continue to retire at 65. That is not generous; it is eminently sensible. The white paper has a lot of cross-referencing. For example, page 77 is headed “Early priorities for action within sound public finances.” That section contains a considerable analysis of how you achieve sound public finances. We must remember that the greatest threat to pensions in the past decade started with Gordon Brown’s stealth attack and has continued with attacks on, in particular, public sector pensions south of the border. Therefore, the prospects for public and private sector pensions in Scotland are immeasurably better because we are focused on progressing the issue with the commission.
You raised the prospect of independence and mentioned the white paper. Given that the teachers’ pension fund is a notional fund and that contributions are paid indirectly to Her Majesty’s Government and are underwritten by it, how can we be sure that teachers’ pensions would have the same degree of protection in an independent Scotland, when the number of contributors is much smaller?
The much smaller number of contributors is matched exactly to the number of people who take the pension. A smaller number of people draw out their pensions and a smaller number of people pay into the scheme because it is a Scottish scheme. That is axiomatic. I commend to Mr Bibby page 138 and following of the white paper, which give a good analysis of why public sector pensions need to be seen in the round. We need to discuss a lot of the issues.
Mr Bibby has chosen to lodge a motion to annul the regulations. I entirely understand why he has done so. It is with great reluctance that we must take forward the regulations, but a Treasury that is not listening has demanded that of us. However, in so doing, we should ask whether there is a different or better way of achieving what is required. The answer is yes, and the way for us to do that is to control the finances in Scotland.
Perhaps Mr Bibby could enlighten us about whether the proposals that Labour is announcing today include the pension schemes being run from Scotland. That would be interesting, because if Labour’s proposals include money coming directly to Scotland for that, perhaps that is a small step forward, but it would be better to see a change across the board and to say how we could do it better for ourselves.
Clare Adamson has the final question.
I declare an interest in that I am married to a retired teacher who is also a former National Association of Schoolmasters Union of Women Teachers rep.
Good morning, cabinet secretary. You mentioned that it would cost £18 million a year in perpetuity were we to mitigate what the EIS has called a Westminster “austerity tax”. It seems to me that, if we were to decide to mitigate the tax, that would be extremely unfair on other public sector workers who will also be affected, such as our hard-working firefighters, police officers, nurses, other national health service staff and civil servants. Will you give us more detail on what the impact on the public sector as a whole would be should we decide to mitigate the tax?
As I am sure the committee remembers, last year at this time, there was a similar motion to annul from Mr Findlay. At that time, the contribution was greater, so we would have been talking about a third of the £100 million cost, which would have been about £33 million or £34 million, and that would have been in perpetuity, too. If that had succeeded last year, and we did the same now, we would be up to roughly £52 million, or just over £50 million. That is equivalent to a considerable number of teachers.
There would be a knock-on effect. It would be inequitable if we reached such a decision for teachers but not for workers in other parts of the public sector. The cost in total last year would have been £100 million, and this year it would be £50 million. That is £150 million. We are never done with Labour telling us how we should spend money but, if we were to spend money in that way, because of the unrealistic nature of the Scottish budget—which needs to be changed in the way that is anticipated in “Scotland’s Future”—we would perforce have to cope with that. I do not think that that could be done.
We move on to agenda item 2, under which, as I said, we will debate the motion that calls for the Teachers’ Superannuation (Scotland) Amendment Regulations 2014 to be annulled. I remind everyone that only members of the Scottish Parliament may participate in the debate and that it may—but does not have to—last up to 90 minutes.
I invite Neil Bibby to speak to and move motion S4M-09312.
Ninety minutes? Is that 45 minutes each way?
I would rather it was not.
We will see.
I welcome the opportunity to speak to my motion. As members will be aware, my colleague Neil Findlay moved a similar motion last year, and I do so for the same reasons today. Teachers, like many other public sector workers, have had their wages squeezed, have been subjected to the cost-of-living crisis and have been put under increasing pressure from cuts that are overstretching vital public services such as school education.
For two years, teachers have had their pay frozen and they are now finally receiving a long overdue 1 per cent rise. However, many teachers will be concerned that, yet again this year, they are set to pay an increase in pension contributions. In effect, that means that there is no 1 per cent pay rise for teachers, as they have been given the rise in the one hand while money has been taken out of the other hand to pay for an increase in pension contributions.
When we discussed Neil Findlay’s motion last year, the cabinet secretary said:
“At a time of wage restraint and financial hardship, it is wrong to ask such public employees to pay more for their pensions in this way”.—[Official Report, Education and Culture Committee, 26 March 2013; c 2140.]
I agree. Therefore, the question is: why have Scottish teachers yet again been asked to bear something that is wrong?
The general secretary of the EIS has described the latest increase as
“an austerity tax on hard-working teachers.”
As members will be aware, the EIS has welcomed my motion. It has pointed out that this is the third increase in three years and that it will increase the average pension contribution that is deducted from teachers’ pay to 9.6 per cent of their salary. That means that the amount that is deducted from teachers’ pay will have increased by 50 per cent since April 2012, from 6.4 per cent to 9.6 per cent for the average teacher. For classroom teachers on the main grade pay scale, the three years of increases will mean that they will be paying more than £1,000 more per year in pension contributions. The EIS has said:
“The objective of the Coalition Government was not to protect the low paid or to minimise opt outs. It was to raise revenue.”
The Scottish Government has accepted that objective.
The Scottish Government has also decided to pass on the increases in the same tiered way as the coalition Government. The EIS has expressed concern that teachers who are progressing by increments through the main grade scale should have been protected. That point was raised last year and was supported by hundreds of emails from teachers, but the Scottish Government ignored it.
In October 2013, the Scottish Secondary Teachers Association conducted a survey of members, more than half of whom expressed concern about their likely financial situation post-retirement. Almost half said that they were ready to take industrial action to protect their pensions.
Teachers are working flat out and are under a great deal of pressure to prepare children for new exams and to implement the new highers. They deserve far more support and recognition than they are getting. They deserve far better from the Scottish Government, which is simply passing on a Tory teacher tax.
I move,
That the Education and Culture Committee recommends that the Teachers’ Superannuation (Scotland) Amendment Regulations 2014 (SSI 2014/44) be annulled.
10:30
I see from our papers that the decisions taken by the Scottish Government under the regulations, including everything from the delay in laying them to their detail, are simply being laid at the door of the UK Government. As the cabinet secretary rather persuasively put it, if we spend more money in one area, we have less to spend in others.
Simply telling us and telling teachers that things would all be very different in an independent Scotland is not persuasive or satisfactory. Any Government would still be faced with the same challenges—spending more in one area means having less to spend in another area. The cabinet secretary has made much of his reluctance in laying the regulations but, as Neil Bibby has indicated, it does not appear to me that a great deal has been done to adopt and adapt an approach in Scotland that is very much different—despite the fact that, as we heard last year, there are concerns about the structure of teaching in Scotland being different and perhaps meriting more focus.
Although I am prepared to support the Scottish statutory instrument before us, I do not think that it is credible to pretend that somehow everything would be very different were the rules of the game to be changed.
The key point, which was not touched on by Mr Bibby, is the sheer cost. Where would the money come from? Which services would be cut so that we could afford to implement what is proposed? It has been a recurrent theme with Labour motions that they never seem to give the detail of where the money would come from. This is just another case of that—£50 million is a lot of money in our budget; where would it come from?
Nobody wants to increase pension payments for teachers. They are hard working, and they make a huge contribution. In the end, however, I do not see that we have a choice.
I am pleased to support Neil Bibby’s motion to annul the regulations. We have opposed the increase in the pension contribution before, and we oppose it again. The teaching unions have long-standing concerns and have highlighted the impact that the increased payments would have on deductions from teachers’ salaries. As we have heard, the increases that have been implemented over the past three years have amounted to more than £1,000 per year more coming out of teachers’ salaries in pension contributions. I am sure that many teachers view the increased contributions as a pay cut rather than as public sector pay restraint.
The EIS has welcomed the motion lodged by my colleague. It has highlighted the fact that significant challenges still face teachers and their incomes. I hope that the cabinet secretary will engage with the EIS and the other teaching unions on the issue of teachers’ pay. I support the motion.
Like others, I know exactly how hard teachers work, and I give credit to each and every one of them, given all the changes that they face, and given that they are doing so well.
I have two questions. I apologise again for going back to 2011 but, at that time, the Auditor General recommended that the Scottish Government should
“provide a clear statement of the aims and objectives of the public sector pension schemes in Scotland”
and
“consider whether differences among schemes in areas such as contribution rates and level of benefits are necessary to realise the objectives of each scheme”.
My first question, convener—
We are not having questions to the cabinet secretary.
My first point, then, is: what was done in 2011?
My second one is to Neil Bibby, and it is similar to the previous questions. We have heard that there is a deficit in the scheme of £240 million. Despite the increased contributions that there have been in recent years, there is still a deficit of around a quarter of a billion pounds, with money being taken from other budgets in order to fund it. I ask Neil Bibby to tell us, in his summing up, where that money will come from. Is the pension scheme affordable and sustainable in the long run? Is it fair to the contributors, to the pensioners and to taxpayers?
Neil Bibby came out with a cheeky wee bit of alliteration when he referred to the “Tory teacher tax”, but part of the problem with this debate is that the Opposition parties are coming out with wee cheeky lines like that one without offering anything of substance. Once again, they demonstrate their begging-bowl mentality by asking for more money without telling us where that money will come from.
The situation in the real world is exactly as the cabinet secretary has described it. The choice is between two futures: independence or a future in which we continually sit here, being dictated to by a Westminster Government. That is the real and important debate that we should be having. After all, we are dealing with teachers’ lives and I think that it is quite degrading for Mr Bibby to use a cheeky throwaway phrase like “Tory teacher tax”. It is glib and smug, and does not really represent the level of debate that we need.
As I have said, the reality is that we have a choice between two futures, and this SSI is a perfect example of why Scotland needs to vote yes on 18 September.
I am probably about to repeat what I said last year, but I think that Mr Bibby makes a fair point about the teachers’ situation. All committee members will agree that teachers are hard working and that none of us wishes to be in the situation that we find ourselves in.
However, unless Mr Bibby gives us a detailed answer to the question that Mr Findlay could not answer last year—where we find the £18 million, roughly speaking, that the cabinet secretary has said would be required this year—his motion to annul will, in effect, fall. Of course, that is just the figure for teachers; the same approach would have to be taken for the whole of the public sector. Which part of the budget would that money come from? After all, we cannot make a hole in the budget without Mr Bibby saying where the money would come from to fill it. If he can do both sides of the equation, we can have a discussion, but if he cannot, his motion, I think, has no merit.
Convener, I should have declared an interest earlier, as Mary Scanlon and Clare Adamson did. I have a sister who is a teacher and a mother who was a headteacher and almost certainly benefited from the scheme.
Thank you, Mr McArthur.
I call the cabinet secretary.
I agree with Mr Bibby on almost everything that he said. The situation is regrettable and in the best of all possible worlds, which, in my view—I know that Mary Scanlon, Liam McArthur, Neil Bibby and Jayne Baxter will not agree—would be an independent Scotland, we would not be having this debate. Unfortunately, Mr Bibby’s argument fell at the very end, when it revealed itself as belonging to the something-must-be-done school of politics instead of the this-is-what-should-be-done school of politics. That is the real issue.
I commend Mary Scanlon for her approach, because she is asking serious and important questions about pension provision for the future of the Scottish teachers’ pension scheme, and I will be very happy to facilitate a meeting between her and Mr Dawtry to examine the detail of the scheme. That said, I point out that any such discussion will have to take place in the context of reserved policy on occupational pensions. We are really constrained on that matter and, indeed, are particularly constrained on the teachers’ scheme. Every time we have sought variation—and I am happy to meet Mary Scanlon to tell her about the variations that we have sought—we have not been able to achieve even modest variation in our negotiations.
However, as I have said, Mary Scanlon is asking good questions, and it is important that we have that debate. In fact, it should continue after the powers for the scheme are repatriated to Scotland to ensure that we have a constructive debate about providing the best and most affordable pension scheme for Scotland’s teachers.
Jayne Baxter sort of accused the Scottish Government of not engaging on the issue of teachers’ pay. The fact that we have had a detailed negotiation for the best part of two years shows a serious level of engagement by the Scottish Government, and I find it gratifying that we now have a settlement not just on pay but on supply teaching and the McCormac report and its recommendations. That is a tribute to the serious negotiations that the teaching unions, the local authorities and the Scottish Government have been undertaking, and it shows that we have engaged on all of those issues.
The difficulty with tiering, which has been mentioned by members, is that it has not been possible to get agreement among the unions themselves about how it should happen. I made that point last year, and I make it again this year. We have tried to get an agreement among the unions on the tiering proposals, but in the end we settled for these particular proposals, which we felt were the fairest and offered as much protection as we could find for new, lower-paid teachers. However, we could have gone further had we got agreement among the teaching unions.
In response to Liam McArthur, I agree that we can all be tempted by simplistic solutions. Mr McArthur has taxed me with having a simplistic view of the matter and with simply saying, “If independence existed, things would be better.” That is certainly a simple solution—and, I think, the right one. “Scotland’s Future” contains very considerable proposals for taking the whole issue of public sector pensions a major step forward. That is what we need to do, which is why Mr Bibby’s motion is welcome. It allows us to have a discussion not only about a proposal that we are all dissatisfied with, but about being constrained by decisions that are made elsewhere. Instead of splitting on how we might take things forward, we could unify on the means to take forward better, affordable and sustainable public sector pensions in Scotland. That would be another major gain from independence.
It is with no great enthusiasm that I say that Mr Bibby’s motion must fail. I just hope that we will not have to come back to this matter in future years, when we will have control over pensions and will be having the type of debate that Mary Scanlon has invited us to have.
I invite Neil Bibby to wind up the debate and to indicate whether he intends to press the motion or to seek to withdraw it.
Scottish National Party members are beginning to sound like a broken record. Last year, they were saying, “If only we had these powers”, and it has been the same today. Leaving aside the fact that promising Scandinavian levels of public investment and American levels of tax is financial nonsense and that the SNP’s priorities for tax cuts in the white paper are not teachers but big business and millionaires, the truth is that neither the cabinet secretary nor SNP members have made the argument for increasing teachers’ pension contributions. Indeed, Mr Russell said that he entirely understood why I had lodged my motion and Colin Beattie said that no one wants to increase teachers’ contributions.
I will therefore press my motion not to increase teachers’ pension contributions and pass on the Tory teacher tax.
The question is, that motion S4M-09312 be agreed to. Are we agreed?
Members: No.
There will be a division.
For
Baxter, Jayne (Mid Scotland and Fife) (Lab)
Bibby, Neil (West Scotland) (Lab)
Against
Adam, George (Paisley) (SNP)
Adamson, Clare (Central Scotland) (SNP)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Maxwell, Stewart (West Scotland) (SNP)
McAlpine, Joan (South Scotland) (SNP)
McArthur, Liam (Orkney Islands) (LD)
Scanlon, Mary (Highlands and Islands) (Con)
The result of the division is: For 2, Against 7, Abstentions 0.
Motion disagreed to.
I thank the cabinet secretary and his officials for attending this morning, and I suspend the meeting briefly before we move on to the next item.
10:43 Meeting suspended.Previous
Attendance