Maybe it was deliberate kite-flying. Maybe David Cameron thought that he was only talking to a handful of northern businessmen. Either way the Tory leader indicated this week – at a meeting of the Greater Manchester chamber of commerce – that he was minded to move away from public sector final salary schemes: “We’ve got to end the apartheid in pensions,” he said.
There is cold logic behind the position: the state may struggle to keep supporting the ever-growing cost of public sector pensions: a £650bn liability over 20 years.
But for millions of workers – whose pay has barely risen in recent years – decent pensions are arguably their greatest incentive to keep on the state’s payroll. What does Cameron hope to gain electorally from voicing this argument?
I did a straw poll of people with NHS workers today – my wife, brother, mother - and they are all furious with the Tory leader. (Yes I am on holiday, no I haven’t gone anywhere).
A few months ago I spoke to one of Gordon Brown’s confidantes. He believed the Conservatives had made a blunder by expressly opposing the expansion of Heathrow in favour of high-speed trains to the north.
It wasn’t that the Tory policy was wrong per se, but that they had nailed their colours to the mast too soon.
“There may still be a year and a half to the next election, but they put out a specific policy which we can take to pieces in the coming months. They would have been better off keeping it vague,” he said.
So too with Cameron’s plans to switch public sector workers to money purchase pensions. Conservative Central Office say this policy is not set in stone; it’s merely a “direction of travel”. Others will believe the cat is now out of the bag. Dave – you’ve just alienated nearly 5m people.
Jim Pickard
Kiran Stacey
