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LGA withdraws councillor pension U-turn claims

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The government has denied it is preparing the ground for a U-turn over its plans to ban councillors from the Local Government Pension scheme following an outcry from local politicians.

A spokesman at the Department for Communities & Local Government made the denial after suggestions in an internal LGA report that ministers could allow council leaders and cabinet members to remain in the scheme.

The LGA has now withdrawn those claims.

The LGA’s leadership board – the committee that advises its main decision-making executive body –is set to discuss options for campaigning against the proposals announced by local government minister Brandon Lewis shortly before Christmas.

A report to be discussed at the meeting originally said Mr Lewis has since “suggested to lead LGA members that it is not the intention to exclude council leaders or cabinet members from the pension scheme”.

But a DCLG spokesman insisted the proposals remained unchanged.

“There has been no change to the policy proposals announced in December. We will be publishing a consultation paper, as required by law.”

And Gary Porter, the leader of the LGA’s Conservative group who has held a number of meetings with Mr Lewis over the proposals, insisted the local government minister had made no such suggestion to him and that he would continue to press for all councillors to be allowed to remain in the scheme.

“I’m arguing it should be left alone, that it shouldn’t be touched,” Cllr Porter said. “Anything that threatens the ability of ordinary people to become councillors should be resisted. We’ve changed things so that ordinary people can get into Parliament and that’s how local government should be.”

A spokesman for the LGA said: “The reference to council leaders and cabinet members’ membership of the Local Government Pension Scheme in the Leadership Board agenda was a drafting error and should not have been included. It has been removed from the report. Our position remains unchanged – we support the right of all councillors to be members of the pension scheme. The Leadership Board will this week discuss the next steps of our lobbying strategy in support of this objective.”

‘Not full-time’

Mr Lewis announced shortly before Christmas that councillors would not be able to join the LGPS after April 2014 and that current members would cease to accrue benefits from that date. In a written ministerial statement, Mr Lewis said barring councillors from the scheme was justified as they were not “full time politicians” in the way that elected mayors or police and crime commissioners are.

Following the announcement, there was widespread outcry from local politicians – including a large number of Conservative councillors. Cllr Porter said he had received “a large amount of lobbying on this from Conservative councillors to resist the idea”.

A survey of 105 council leaders conducted by LGC last month found a majority opposed the proposal and that 70% rejected the notion that they were volunteers.

The pensions proposals was also one of the main complaints listed by more than 30 Conservative county and unitary council leaders in a letter to David Cameron last month in which they warned attacks against the sector risked causing a “fractious relationship” between local and national party politicians.

Legal advice

The LGA has taken legal advice on whether the plans are lawful and is now deliberating how hard to campaign on a topic it accepts is “highly sensitive” and “unlikely to attract public support”.

LGA members must now decide whether to object to the proposed exclusion of councillors from the LGPS on principle or push for a solution that sees some councillors made eligible for scheme membership.

The legal advice that the LGA has received is that “there are real problems for the minister should he decide to withdraw membership”. Lawyers believe the decision could potentially be open to judicial review if he fails to give due regard to the responses given in the consultation.

Another avenue would be to claim that councillors’ allowances mean they could be designated as ‘workers’ for a council under the Pensions Act 2008 which requires employers  to provide access to a pension scheme for its workers.

Lastly, the LGA could claim that any attempt to differentiate between full-time and part-time members and elected mayors could lead to claims under the Equalities Act 2010 for indirect discrimination/equal pay.

“Resolving the issue of members’ pensions is a high priority for the LGA’s membership but it is highly sensitive and unlikely to attract public support,” the paper reads.

The decision on whether or not to offer councillors membership of the LGPS is taken by councils’ independent remuneration panels. The LGA has also conducted research to ascertain exactly how many councils offer scheme membership to councillors and how many councillors claim membership.

Across England and Wales, some 3,311 – or 17% - of councillors have taken up membership of the LGPS.

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