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WUK AND DEAD? STRUGGLE INSTEAD! TRADE UNIONISTS REFUTE ECA ON RETIREMENT AGE

posted 9 May 2017, 18:38 by Gerry Kangalee   [ updated 9 May 2017, 19:14 ]
Image result for retirement age increaseThe question of increasing the retirement age is front and centre on the agenda of the class struggle. Employers across the core capitalist countries attack workers’ pensions by cutting benefits, raising workers’ contribution rates and by trying to force an increase in the retirement age.

It is part of the strategy of neo-liberalism as it pursues its futile bid to save capitalism. According to Asbjorn Wahl, Vice Chair of the Road Transport section of the International Transport Workers’ Federation: “big parts of the trade-union bureaucracy have stagnated in a social-partnership ideology that no longer has any meaning, since capitalist forces have withdrawn from the historic post-Second World War compromise between labor and capital, and gone on the offensive to defeat the trade-union movement and get rid of the best parts of the welfare state.”

Like faithful neo-colonials, employers and their professional spokespersons in T&T want to trump and follow suit.

Economists, like Roger Hosein, urge the government to increase the retirement age and the Employers’ Consultative Association (ECA), that old nemesis of the organised working class, not surprisingly supports this position.

During an interview with this website, Dave Smith, President of the National Workers Union (NWU) made a wry comment: “If the ECA supports an increase in the retirement age then, almost automatically, it is bound to mean that it is against the interests of the working class.”

The ECA claims that because life expectancy between, 1960 and 2014, increased by almost ten years from 62.66 years to 72.29 years, there is a case for increasing the retirement age. Kathleen Davis, the leading health, safety and the environment practitioner in the labour movement stated: “It seems that the ECA is determined that workers should not have any retirement. In the 1960’s, most workers would seem to have died before they reached retirement age or just a couple years after. Now that, on average, a worker would seem to get just over seven years of retirement they want to take that away.”

The ECA stated: “When we look at the current state of the economy and factor in the uncertainty surrounding our future, we have 
Dave Smith
all agreed that it cannot be business as usual.

Dave Smith responds: “Arguments about the “current state of the economy” or “uncertainty surrounding our future” are short term arguments. Even if there was an economic boom they would not want to concede any improvements “It cannot be business as usual” is a euphemism for “we want to find a way of exploiting labour more than we are at the moment”. “We have all agreed” means the employers have developed a common position.

The ECA puts forward: “From the government’s perspective, there is a growing need to rationalise expenditure to compensate for the significant fall in revenues. By increasing the retirement age, this reduces the demand on the Government’s coffers via social services.”

Dave Smith counters: The fall in Government revenues is largely as a result of the drop in oil prices. The cost of this should not be borne by workers. It is not accurate to say increasing the retirement age will reduce the pressure on social services.” He added it is not clear what the ECA means by social services and how increasing the retirement age will impact on this. 

Smith continued: “There is a possible argument that increasing the retirement age might increase government income from income taxes and the ability to spend more (hence increasing income from VAT). However, this would only apply if workers were in jobs where they earned enough to pay income tax. (The first $72,000 annual income is non-taxable)

The ECA stated: “This reduction in the provision of social services such as pension and the National Insurance System (NIS) will extend the life of these services to benefit future generations.”

Smith argued: "There needs to be a clear distinction between NIS and social services. NIS is the product of payments made into the NIB and benefits that are therefore accrued. Like any plan, payments in and benefits out can be varied to make the scheme viable in the long term.

Social services would probably cover old age pension and health care. Although it could be argued that the concept covers education, the police and all other provisions provided by the state. Old age pension is a gradually decreasing expenditure as more and more people are entitled to their NIB pension. Increasing retirement age would not seem to impact on this.”
Kathleen Davis

Kathleen Davis added: “Health care expenditure will increase as the population ages. Increasing the retirement age would not seem to impact on this. An aging and ill population is the joint product of better living standards (increasing life expectancy) and a poor life style (unhealthy food, little exercise, working too long hours, poverty). It is difficult to see how increasing the retirement age would impact on this.” Health care, she added, is a class issue.

Waxing warm, Davis stated: “Is this a good reason for increasing the retirement age … future generations benefitting at the expense of present generation? There seems to be little connection between the issues raised by the ECA and increasing the retirement age. What is their projection of increased profits? If we are to look at the costs of maintaining or improving the social wage then we need to also look at the question of profits and how the capitalist class can be made to pay for improving the social wage.” 

The ECA stated: “This is especially important given an April 2015 actuarial review of the NIS scheme, which concluded that the system will be completely bankrupt in 24 to 25 years.”

Smith argued: “Actuarial reviews can ensure that national insurance schemes can plan ahead. The NIS will only be bankrupt in 25 years if nothing is done to review income and expenditure. This is just the ECA laying the groundwork for attacking the social wage. Increasing income to the NIS would probably mean increasing NIS payments which the ECA would oppose. They would rather see reduced benefits than increased funding. It might be possible to make a link here. Reduced NIS benefits would put pressure on workers to want to keep working beyond retirement age, in order maintain their standard of living.”

The ECA stated while most companies might be reluctant to hire people older than 60 years, the propensity to retain existing employees of that age is much higher and can be beneficial. It will assist in minimising the skills gap in the labour force, as older employees have more time to teach younger ones.

Davis countered: “In some countries it is now illegal to discriminate on grounds of age. This means that there would be no such thing as compulsory retirement at a certain age. Some workers might like this, but this option may be the product of trying to get some sort of liveable income during older age. Who would desire to carrying on working would be the subject of an interesting discussion. We need to have a broader discussion about the quality of work/private life.”

Sylvan Wilson
In an interview with this website, Sylvan Wilson, former Chief Labour Relations Officer and Vice President of the Oilfields Workers Trade Union stated: “The rationale put out by the employers really does not hold. The NIS financial position is not due to the retirement age. It is primarily due to the change in the demographics because women are having fewer children.

Social security was founded on the principle of "pay as you go". In some cases it was premised on five plus contributors to every recipient. In T&T we are fast approaching a one to one ratio. Increasing the retirement age primarily delays the primary crisis unless the retirement is increased to the day before death. In most countries the State does not contribute to the social security.”

Wilson, acknowledged as the foremost expert in the labour movement on pension plans and other social wage issues, added: “It is important to note that some plans do not build up a huge savings fund; those rely on cash flows to finance their operations. Those plans are never funded to cover ALL liabilities Most of those with savings funds underperform because of inherent weaknesses of capitalism, poor investment decisions due to political manipulations and outright corruption.

The issue of increasing the retirement age really rests with the purpose of this life. Is it to work till we dead or is it finding a balance between the need to work and enjoying the many wonderful things in this life. The value of our production at the workplace allows for a reduction in the retirement age.

The trillions of dollars allocated to arms and war, funding insatiable greed, consumption of narcotics etc. Why must training of young workers be done by persons after age 60? Is it not that employers see this as a cost savings mechanism at the expense of young workers?" 

Cecil Paul, Head of the National Issues Committee of the Trinidad and Tobago Association of Retired Persons (TTARP), weighed in on the ECA position:”This is an old position rehashed due to the economic climate. Its purpose is to increase workers’ contributions to retirement incomes and reduce employers’ liability to fund pensions.”

Paul, former First Vice President of the OWTU, said workers again are being called to bear the burden of decreasing private sector and
Cecil Paul
government revenues due to economic decline. “Pension funds are a major source of finance capital so by delaying workers’ pensions by 5 years a larger pool of funds will be available to the ruling elites. There are no significant benefits to workers by this extension of the retirement age to 65. In fact the ECA position admits this.

The increase in life expectancy is no justification for longer working years which deny the workers of retirement enjoyment. When the retirement age was 65 many workers died a short time with a sizable portion of their pensions staying in the plan.

Reducing pensions will not extend the life of the fund and provide for future workers. Pensions are based on joint contributions and a factor of wages/salaries. In most cases the employer has the larger contribution liability. The employer is looking at ways to reduce his liability or to either have harmonization with NIS or insured plans, both of which will reduce their liability.”

The veteran trade unionist argued: “The argument of bankruptcy of NIS is empty fear mongering to justify their liability to workers’ NIS and a old stale argument as hundreds of millions of dollars go into NIS monthly with pensions payments less than contributions. The fact is NIB money is a pad for government programs and a bed of questionable projects by NIPDEC.

Actuarial Valuations are basically projections by firms; in most cases feeling that they owe the corporations loyalty for the high fees
Image result for retirement age increase. Recently NIS contributions were increased. Does that not count for something? In any case Actuaries always predict a bad future and increased contributions to safeguard against bad projections.” 

“Many workers” Paul said “stay in the workplace for some 35 years at age 60. It is punitive to have them work beyond 35 years unless it's voluntary. Leisure time and voluntary work is a factor of humane societies. They argue that retirement at 60 years will facilitate training of young workers. Why can’t this training begin when the trainer is 55 up to 60?

What most do is keep out the young worker and have the retiree work at lower rates. In the case of the young worker, a contract is given with no company pension, inferior wages/salaries and no job security. So the training argument does not hold. Extending the retirement age to 65 will delay and deny young workers job opportunities.”

There are many corrections to be made to pensions in the country but extending the retirement age is punitive without any benefits to workers and seeks to benefit the corporations and ruling elites.”

When the employers try to force us to wuk and dead, we must put aside the rhetoric and struggle instead!
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