I’m a pensioner. I have four pensions in three categories – a state pension, a company pension from a private employer and two private pensions I set up with private providers when I was in business.
I’m a Yes voter, firmly committed to Scotland’s independence, and I’m not the least bit worried about the security of any of these pensions in an independent Scotland.
For many in Scotland, a fourth category can be added to the above three – public sector pensions.
Here’s seven reasons why I’m not worried – and why you should not be afraid to vote Yes because of pensions. This is my understanding – as an informed and concerned voter and pensioner – of the current situtation.
1. State pensions: State pensions are guaranteed by governments. Your state pension is an entitlement built up by years of National Insurance contributions and credits in UK. On independence, that entitlement passes to the Scottish Government to administer as a Scottish State Pension. This has already been confirmed by UK Department for Work and Pensions in writing. If you doubt it, write to them and get personal confirmation – many have done so already.
2. State pension terms can be varied by governments, and are being varied by the UK Government at the moment, both in terms of entitlement and age of retirement. These changes will come into effect in April 2016. Scotland becomes independent in May 2016. The Scottish Governments pension terms, as set out in the White Paper, will be higher than the new UK provisions, and will be guaranteed by a triple lock, and will offer better provisions for spouses.
3. Private sector pensions: In terms of rights and accrued entitlements to private pensions, there will be no changes on independence. This is because private pensions are a private matter between individuals and their pension providers. The Scottish Government will establish a Scottish Pensions Regulator to make sure these rights are protected and regulated, and will cooperate with the rest of the UK in this.
4. Public sector pensions: The Scottish Government has stated that all rights and entitlements to public service pensions will continue to be protected on independence, and that there will be no difference to individual contribution rates or benefit levels as a result of independence.
On independence, the public service pensions of members of currently reserved schemes who live in or work for Scotland – for example, the armed forces and civil servants – will continue to be paid in full.
5. Private pensions set up by individuals with pension companies: These are private, legally binding contracts, protected by law. Such contracts exist independently of constitutional changes, and are a matter for you and the company you bought the pension from.
6. Risks to pensions: In the lead-up to the 2007/2008 economic meltdown, Gordon Brown’s light touch regulations of the banks led to widespread, highly risky gambling by investment banks and derivative traders. Early signs of trouble were private companies defaulting on their pension commitments to employees. This behaviour was replicated across the world. It led to the 2008 crash which jeopardised pensions, savings and almost brought the world economy to its knees. The current UK government is now massively in debt because of this. No British banker was prosecuted for this criminal dereliction of duty and financial probity.
Risks to pensions are in the same category as risk to savings, bank accounts and financial investments – they depend on the world economy, the local economy in a country, the behaviour of governments of the day, and the behaviour of financial institutions. These risks, far from being greater in an independent Scotland, will be less, and your pensions will have a greater degree of security, with pension providers kept under greater scrutiny and tighter regulation.
7. Viability of Scottish economy: Scotland is a rich country, one of the richest in the world, but under UK, much of that wealth is sucked down to London from our oil revenues and taxes. We get back much less than we give. An independent Scotland will be better off because we will keep all of the wealth generated in Scotland, for the benefit of Scots. By leaving UK, we immediately gain the major part of our oil revenues , we lose the crippling costs of Trident, the House of unelected Lords, the costs of sending 59 MPS to a Parliament of 650 where they can make no real difference – and we liberate the economic opportunities for Scotland, for jobs, for our young people to be lifted from despair into real jobs and real careers. And it’s our young people – the new generation – who must work to fund the pensions of those who contributed all their lives to the country that now values them and will protect their interests.
N.B. This is of necessity a brief summary of a complex matter. It is also the personal view of a Scottish voter and pensioner. Much fuller details of all pensions guarantees and changes can be obtained from the Scottish Government’s White Paper, from Yes Scotland and from the UK Department for Work and Pensions, also from your occupational (former employers) or private pension providers.
Photo: Documenting Yes