Prescott bows to unions on pensions

JOHN Prescott is expected to back down over controversial plans to force some of the lowest-paid public employees to work an extra five years for their pension.

Union leaders have warned the Deputy Prime Minister that public sector activists might be reluctant to campaign for Labour in the expected May General Election because of anger over the proposals.

Talks are taking place this weekend between Prescott and leaders of public sector unions, including David Prentis of Unison, to come to a deal.

Prescott is expected to agree to defer the pension proposals to allow more time for consultations. Sources close to the talks said: 'We expect Prescott to kick this into the long grass. We are in favour of modernising the scheme, but the Government is insisting on changing the regulations by April 1.

'If Labour wants the support of activists in the run-up to the election, something has to give. All we want is proper negotiations. As a first step, the Government should withdraw regulations that will change the local government pension scheme.'

Unions are protesting over the removal of the rights of employees with long service to retire at 60 on full pension. They will have to work until 65.

Under the new rules, early retirement packages would be available from 55 rather than 50. The average public sector pension is £3,800 a year.

The talks, taking place at Labour's three-day spring conference in Gateshead, Tyne and Wear, are overshadowed by the threat by up to one million public sector workers to strike over the issue.

Members of the big three unions - Unison, Amicus and the Transport and General Workers - are being balloted. The Fire Brigades Union and others are expected to follow suit. Unions say March 23 is the likely date for any strike.

They are confident of a huge yes vote for industrial action, which could bring chaos to rubbish collections, schools, town halls and other essential operations.