Posted by:12 January, 2012
Despite the best efforts of negotiators the local government deal for pension reform fell down at the last hurdle. So what exactly happened?
For several weeks leading up to the deadline for agreements on pension reform, negotiators were quietly confident they could not only produce something acceptable to all sides - unions, employers and ministers - but that they might also be able to produce the first agreement of all the different public sector talks.
In the end, the local government deal was the last to be put in place after a farcical and last minute error by an unidentified letter drafter somewhere in Whitehall.
There the LGA and the unions were on 20 December, poised to unveil the deal following months and months of painstaking discussion. Before going public, they had run their proposals past central government colleagues because, after all, it wouldn’t do to get the thumbs down from ministers at the last minute.
Chief secretary to the Treasury Danny Alexander was due to stand up in the House of Commons at 12.30. An hour beforehand the negotiators were still nervously waiting for the formal acceptance letter from communities secretary Eric Pickles. Tick, tock, tick, tock…
Just before Mr Alexander got to his feet, the letter came through and the authors of the agreement were immediately on the phone shouting “no deal”. Ministers were accused of trying to stitch local government up, inserting references to cost limits, retirement age & career average pensions into the acceptance letter which were not in the extremely carefully phrased agreement drawn up by local government employers and unions.
By the time Mr Alexander had walked from the Commons to his post-statement press conference, journalists were armed with questions about a last-minute disaster he knew nothing about.
Brought up to speed, ministers quickly said the offending letter had been withdrawn and a new version would be issued. Away from the cameras there was a flurry of phone calls, emails and meetings as local government negotiators, civil servants and ministers rushed to resurrect the tattered local government deal.
A telephone conference was organised for all and sundry. Ministers offered reassurances, a few recriminations were made, and a new letter was published.
What had happened? Who was to blame? Mr Pickles, who takes pride in his straight-talking Yorkshireman image, was the signatory to the letter - and his picture was plastered all over the papers the next day - but no official letter is penned by ministers alone. Whether the offending items were inserted while crossing a number of Treasury and DCLG desks before it settled on his blotter is open to question.
The LGA, Unison and GMB were back at the negotiating table this week, but Unite has walked away from the deal altogether citing the letter as a the last nail in the coffin as far as their trust in ministers goes.
Whether the letter is the real reason for their withdrawal is unlikely - the union has also rejected the NHS pension deal and it has been suggested, and denied, that it is paving the way for a merger with civil service union PCS who have also taken a hardline approach to pension reform. Regardless of the truth of the matter, the pen strokes of someone somewhere in Whitehall gave the union a martyr-like exit.