Happy Birthday NHS, you might not survive to see 64

Ahead of tomorrow’s Young Fabian Science and Society Network event with Shadow Health Secretary, John Healey, Young Fabian member Amanjit Jhund argues the Government’s reforms are just cuts by any other name.

On Tuesday the NHS turns 63. It’s a time for many of us to celebrate: for most of us it is difficult to imagine life without it.

Yet the Health and Social Care Bill is an attack on the NHS on an unprecedented scale. The concerns for many on the left and in the medical community is that while the aims of the coalition proposals are laudable they are simply being used to mask both spending cuts within the service and the increased privatisation of the NHS.

In fact,  many of the GPs that I have spoken to are fully aware that their budgets for commissioning will only be a fraction of those administered by Primary Care Trusts currently. One GP told me recently that “it’s just a way of pushing through cuts”. While most GPs are pragmatic about the changes and will do their best for their patients no matter which system they have to work within, it is vital that the coalition are held to account on this issue.

With David Cameron purporting to defend the NHS, we must expose the hypocrisy of his words as he presides over changes that will not only slash budgets but will also take the ‘N’ out of ‘NHS’.

Happy 63rd birthday NHS. I just hope you’re still around when I’m 63.

Further reading:

• NHS needs evolution, not Tory revolution
• Briefing: Exposing the continuing flaws in the NHS reorganisation
• NHS forum GP admits private patient doubts

Is Clegg’s NHS ‘muscular liberalism’ all a front?

I’ve been pondering the content of the policy statement Nick Clegg signed and circulated to the Liberal Democrat Parliamentary Panel yesterday, which is the focus of so much media attention this morning.

On the one hand it looks as if Clegg is a badly briefed imbecile, given much of his assertions have no basis in fact and his view of what Monitor should be sounds suspiciously like those of an economic regulator (the thing he seems so vehemently opposed to).

On the other hand, he could be supremely intelligent and pulling a fast one on his Lib Dem colleagues – and the public – to make it look like he is taking a principled stand whilst in fact arguing for little real change at all.

He is a politician, so I can’t really tell if he is stupid or liar.

According to the Guardian, the document says:

“We cannot treat the NHS as if it were a utility, and the decision to establish Monitor as an ‘economic regulator’ was clearly a misjudgement, failing to recognise all the unique characteristics of a public health service, and opening us up to accusations that we are trying to subject the NHS to the full rigours of UK and EU competition law.”

“I have come to the conclusion that we must not make this change. We must remove from the bill changes to establish Monitor as a competition authority. Monitor should be empowered to encourage informed patient choice and act against anti-competitive practices but only when this is in the interest of patients, individually and collectively, and in the interest of equality of access.”

This is nonsense for a number of reasons.

First, the NHS is not explicitly excluded from the “full rigours of UK and EU competition law”. Increasingly, healthcare services* are provided by organisations other than the state, with third parties competing for NHS funding to provide services for the NHS. This sort of activity is not outside the remit of competition law. While the proposals in the Health and Social care bill would extend this type of activity, the status of Monitor would not affect the fact that the NHS’ activities are currently subject to UK and EU competition law.

Secondly, no competent competition authority would, as seems to be implied, act in such a way that consumers would be worse off as a consequence of its activities. The whole purpose of competition law is to protect the interests of consumers, not business. Competition can be a mechanism of delivering higher quality products and services at lower cost, if it works correctly. That benefits consumers. There is also the academic point that if you were concerned about private firms making supra-normal profits, then you would probably want a regulator to ensure this didn’t happen, rather than arguing that there shouldn’t be one at all.**

Thirdly, I’m not certain that a organisation which is “empowered to encourage informed patient choice and act against anti-competitive practices but only when this is in the interest of patients…and in the interest of equality of access” could not also be an economic regulator. Other economic regulators – Ofgem, Ofcom – also have wider public policy objectives which sit alongside their responsibilities as competition authorities. Here Clegg appears to be saying that he doesn’t want Monitor to be an economic regulator, because that would be bad and Monitor should instead be…an economic regulator.

Given that the statement is so evidently nonsensical, I’m confused.

Clegg could be badly briefed on the intricacies of the NHS, of competition law, and of the roles and responsibilities of economic regulators.

Or alternatively, he could be using those complexities to fool his party – and the public – that he opposes the contents of the Health and Social Care bill whilst actually just reinforcing its contents.

Alex Baker is Secretary of the Young Fabians.

*There are a number of other activities which are quite evidently subject to UK and EU competition law. Like the NHS’ other procurement activity – office supplies, catering, cleaning etc.

**This raises a related point which is maybe Clegg is concerned about contestable funding in the NHS, and would prefer complete state provision of healthcare. If that is right, then his opposition to the Health and Social Care bill would be a lot more strong than just on the narrow point about the role, or status of Monitor.

Turning on cabinet colleagues: not good for our health

Following the drubbing his party endured during the local elections and that he received on AV, Nick Clegg has moved to make NHS reform his new number one priority.

Over the weekend, he vowed on the Andrew Maar show to veto the Health Bill unless Andrew Lansley backs down on one of his red-line reforms: forcing GPs to take responsibility for commissioning care.

As I point out in the latest edition of Anticipations, in reforming care commissioning it is vital to ensure that medical practitioners are fully on side. Lansely has failed to convince them and so this element of the reforms must be re-thought. Otherwise the GP-led implementation of the reforms will be chaotic.

The count of health bodies taking aim at the Heath Secretary is growing by the day. In April, the Royal College of Nurses carried a vote of no confidence in the Health Secretary by 99% to 1%. This morning Dr Gerada, the Chairman of the Royal College of GPs, labelled the proposals as “actually risking the NHS and risking the NHS being unravelled irreversibly for ever”.

As the Health Secretary receives blow after blow from industry experts, David Cameron and Nick Clegg appear to have decided to hang him out to dry. Cameron and Clegg have ripped up Lansley’s White Paper- reforms they explicitly both signed up to – and have sidelined the Heath Secretary as Number 10 pushes its own agenda. Lansley is now not even being invited to key meetings as the FT reported earlier this month.

A  senior Tory MP described his colleagues’ treatment of the Health Secretary as “outrageous”. Each passing day makes Lansley’s hold on his job less a grip and more a cling.The bigger the Cameron/Clegg-agreed U-turn ultimately is, the worse his chances of survival. And though still in office, he  is already a lame-duck.

Yes his reforms were ill thought out but surely no minister deserves this kind of treatment from his cabinet leaders who were willing to back him fully when the going looked good.

Lansley’s personal politico-tragedy aside, the real loser from Cameron and Clegg’s coalition posturing is the NHS and its patients. Lansley himself has consistently argued that to allow GPs to opt in or out would create a “two-tier” health service. He believes two systems would hurt care and efficiency. This is what happened with Ken Clake’s ill-fated experiment  with GP fund-holding in 1991 . It would happen again.

Nick Clegg’s approach on this issue is especially damaging. Trying to claw back some of the left-leaning liberals he has been haemorrhaging, he reeled off another ‘let-me-be-very-clear’ statement:  “Let me just be very clear: as far as government legislation is concerned no bill is better than a bad one.” This is completely at odds with his and Cameron’s piecemeal revision of Lansley’s White Paper. Clegg risks it becoming far worse than the sum of its parts.

The only Lib Dem talking sense on the matter is Simon Hughes, deputy Lib Dem leader. He underlined the resolve of many of his party MPs in calling for ministers to “go back to the drawing-board” on health. With Chris Hune’s past misdemeanours catching up with him (again) at the weekend, perhaps Simon Hughes is the Lib Dem rival Clegg should be watching at leadership rumours circulate.

He at least knows that the country, the professional experts and his own party do not want this Bill.

• An online taster edition of the spring edition of Anticipations is now available on the Young Fabians website. The full edition of Anticipations is only available to Young Fabian members. You can join the Young Fabians for as little as £5. For further information and to join visit www.youngfabians.org.uk.

Daniel Bamford is Networks Officer of the Young Fabians.

A ‘maxed out credit card’?

Ahead of the Chancellor’s Budget announcement this week, Young Fabian Member Mark Anderson takes the coalition government to task over its positioning of its austerity measures.

One argument given by the UK government for its vast programme of public sector cuts is that the UK has ‘maxed out its credit card’.  Such a crude and misleading analogy bears no resemblance to the reality of Britain’s financial situation, yet it goes largely uncontested in public debate and serves to legitimise the devastation that is being wreaked on public services, the welfare state and public and private sector jobs and working conditions.

Far from the UK being no longer able to borrow money on the international financial markets, the interest that the UK pays on its debt is currently at a historically low level, as is the UK’s debt-to-GDP ratio. UK ten year bond yields are marginally higher than those for the US and far healthier than those for Australia and New Zealand, for example. In the run up to last year’s General Election, amid scaremongering about a potential debt crisis and the dangers of a hung parliament, yields on government bonds remained stable.

In a September 2010 article entitled ‘Can bond yields fall even further from these historic lows?’, Ross Watson, portfolio manager with Securities and Trust of Scotland told the financial journal Investment Week that:

“For the taxpayer, it is excellent news that the Government can fund its deficit at such low returns.”

Such sentiment presumes against a country close to bankruptcy.

Another argument the coalition government gives for frontloading public sector cuts is that it is unfair to saddle future generations with a mountain of debt. This argument is a perversion of the realities of private sector-induced deficits on several counts.

Firstly, it fails to take account of the fact that over 70 per cent of interest payments on government debt remains within the UK, going into savings and pension schemes – yours and mine.

Secondly, it bypasses the fact that you can’t cut your way out of a private sector-created budget deficit. Trying to do so simply condemns an economy to years of low growth – as seen in Japan over the last decade (when the Japanese government cut its stimulus too soon after recession, before Japan’s private sector had had a chance to recover) or in the UK in the 1930s (the last time that a post-recession public sector cuts programme was implemented in the UK on such a scale). Economic slowdowns make it harder to address structural deficits and repay government debt.

Thirdly, taking demand out of the economy when the private sector has not fully recovered risks a double dip recession which would increase government debt, not decrease it. Despite the Coalition’s best efforts to mislead the public, the UK’s structural deficit is a product not of Labour overspending, but of the collapse in output of the private sector following the collapse of Lehman Brothers in 2008.

Fourthly, at a time when the economy is already on its knees, it leaves the economy ill-equipped to compete against its healthier, better educated and better connected, more meritocratic international competitors.

Ending the previous Labour government’s fiscal stimulus, public sector cuts, a contraction in UK GDP at the end of 2010 and increases in unemployment and associated welfare payments, combined with the damage that the prospect of deeper cuts to come has done to business confidence and investment, have exposed the continued weakness of the UK’s private sector and led to a rise in government bond yields, thus further increasing the amount that the UK has to pay to service its debt.

Austerity is doing the opposite of what we are told it is aimed at achieving, and all this before the cuts have really started to bite.

A version of this post has previously appeared on Left Foot Forward.

What are the Lib Dems for?

This morning, Danny Alexander repeated a line on BBC Radio 5 Live used by Vince Cable a few weeks ago:

“We didn’t win the election. We came third. We’re part of a coalition government. We’ve worked to ensure that as part of the discussions we’ve had that we’ve got a system that is fairer, more progressive.”

I’m not sure this will be a fruitful line for Liberal Democrat Ministers to use in respect of tuition fees, or any other difficult policy discussions they’ll have in the coming years*.

Firstly, it implies that, in the extreme, it is acceptable for two (or more) political parties to campaign on one set of policy proposals but – in the event of a hung Parliament – to ignore all of them in order to form a Government with a working majority. Is that really democratic?

Now if that isn’t what Alexander or Cable meant, then surely their position has to be that Liberal Democrat MPs will support policies on those areas where there is common agreement between the two coalition parties, and on any other issues/policy proposals they’ll abstain from voting or argue they should be left off the agenda for this Parliament.

But that’s not what they’re proposing on tuition fees. At the very least they’re proposing that Lib Dem ministers – the government bit of the Parliamentary party – votes one way, and the rest can do what they want. This would technically be consistent with the statement in the Coalition Agreement on fees:

“If the response of the Government to Lord Browne’s report is one that Liberal Democrats cannot accept, then arrangements will be made to enable Liberal Democrat MPs to abstain in any vote.”

However, it does invite the question: what are Liberal Democrat ministers for if they abandon their policy platform for Government office? Are they even technically Liberal Democrats?

It implies that the role of the Lib Dems in the Coalition is to (a) provide a working majority for the Conservatives and (b) make essentially Conservative proposals a bit fairer. That makes the Lib Dems look a bit pathetic really, and is contrary to the posturing of Nick Clegg and others about their role in the Coalition (see Clegg’s conference speech, for example).

Secondly, it weakens the positive argument FOR policies which were in their manifesto. In future, Lib Dems might well argue that policy X is right and was something that was in their manifesto at the last election for which they have a mandate. But it seems a fair response to say that it is irrelevant what policy proposals they had in their manifesto on the basis that they didn’t win the election – they came third.

They can’t have it both ways with respect to their manifesto.

The Lib Dems really need to work on the justification for this political car crash.

*More of this sort of stuff and the likelihood of the current Government lasting a full Parliament will probably reduce.

Alex Baker is Secretary of the Young Fabians.

Empowering voters – the argument for AV

In this guest post, Young Fabian member James Roberts puts the case for supporting AV.

There is something intrinsically fair about the idea that the percentage of seats that a party has in parliament should be at least approximately equal to the percentage of people who hold corresponding views in the country at large. In contrast, there can be little argument that for a party to secure a majority of 65 (and 55.2% of the seats), as Labour did in 2005, with the support of only roughly 20% of the electorate, is undemocratic. This is partly due to an inherent bias towards the incumbent and partly due to the low turnout that year, but mostly down to the strange and quaintly simplistic voting system at use in the UK: First Past The Post (FPTP).

However, the only reform on offer in the near future is a switch to the Alternative Vote (AV). The distortions inherent in FPTP are well known, and while it is rather less well known that AV can lead to even bigger distortions, it does result in a considerable increase in the number of marginal constituencies and a majority of people’s votes counting, as opposed to the huge potential for wasted votes under FPTP. Most of the numerical arguments have been made and so instead I will try to present the cultural arguments in favour of reform.

Wheras the battle now is between the ability of each party to raise funds in order to swamp a small number of swing voters with material and the appearance of local activity, the deconcentration of electioneering from marginal seats can only increase the power of the individual to make their choices based on the needs of the local community.

The first post-independence Prime Minister of India, Jawaharlal Nehru, a Fabian socialist, made the case that democracy itself is not a ticket to the elysian fields, but is the very medium in which we, if we believe ourselves to be democrats and socialists, have to and should operate: “Democracy is good… because other systems are worse… But merely saying that democracy will solve all problems is utterly wrong. Problems are solved by intelligence and hard work.”

How can we condone continuing to support an antiquated and clearly badly-representative system? Even the joint leader of the German Communist Party in the 1920′s, Rosa Luxemburg, knew the importance of frequent and meaningful elections for maintaining a healthy public discourse: “Without general elections, without unrestricted freedom of press and assembly, without a free struggle of opinion, life dies out in every public institution, becomes a mere semblance of life, in which only the bureaucracy remains as the active element.”

The critics of AV will point out that the trend of falling turnout in Britain is bad enough already, without introducing any ‘fiendishly complex’ reforms that will ‘put people off voting’. On the contrary, it is by providing people with real choices and empowering them with decisions that can actually shape their own lives and their communities, that we can expect to see an increase in voter turnout. The critics will also point out that AV will lead to ‘consensus politics’, often pointing out the example of Italy’s record in (not) maintaining coalitions. This is less about the system itself however than the political culture of a region. Sweden has had a form of Proportional Representation (PR) since the 1930s which has resulted in the Social Democratic Party controlling the agenda of the ruling coallition. This has led until recently to a powerful social democratic consensus and some of the best rates of equality in the developed world, with Sweden (alongside its other Scandinavian neighbors) regularly placing in the top 3 in indices of political and economic freedom.

Before and during the UK 2010 general election, there were very few people who voted for the Liberal Democrats under the belief that they were a party of the centre-right, and in some ways they have succeeded in becoming a ‘moderating influence’ on some of the most regressive aspects of Conservative policy. Even on one of the Lib Dem flagship issues, tuition fees, we see that a considerable number of Lib Dem MPs are prepared to defy the whip and vote against any increase. While it might seem distasteful in today’s political climate to work with the Liberal Democrats, AV could only work to increase the chances of being able to rely on the ‘progressive majority’ that so many voters believed in before the election.

Eventually, with a switch to a more proportional system, such as a form of Additional Member System (AMS) which I myself favour, we could see many of the eurosceptic members of the Conservatives join the likes of UKIP. Meanwhile, it is possible that the gains the far left and the Greens would make might come at the expense of Labour and the Lib Dems, but it is unlikely that a coalition of the left could arise without Labour forming the lynchpin of such a force, as in Sweden.

If we vote against AV in the referendum in May, we do so only out of fear, and yet it will be our undoing. The malaise which has afflicted turnout and general trust in politics in the UK is amplified by the ineffectiveness of our voting system. The thing that people disliked about Labour towards the end of the last government was that politics became something that was done to people, rather than something people did for themselves. Cameron has proposed the ‘big society’ as a hazy way to tap into this desire for localism; we can go far beyond this rhetoric and instead of expecting the army of volunteers to appear, actually empower people to make the changes they want to see for themselves. This is what the Labour movement has always been about. This is the kind of issue we as a party have to put to the forefront of our campaign. This is the political extension of the work done by the co-operative movement and can only result in greater levels of equality of income and opportunity.

But only if we vote ‘Yes’ in May.

This was originally posted on the Merseyside Fabians blog.

Lib Dem conference and Coalition Government: who’s dragging who round the circus?

Years of ignoring the Lib Dems’ conferences are at an end, the Left should be careful to read the signs in Liverpool and the public’s reaction closely.

By the time you read this Nick Clegg will have made his pitch to the Liberal Democrat faithful that their Coalition with the Conservatives is “the right government for right now”. With the polls where they are, this message is going to be a tough sell and whether it convinces either his party’s faithful or the public is something only time will tell.

Poor Nick’s got a difficult balancing act: reaching out to the public without completely trampling over his party. Clegg has to convince his party that that he hasn’t gone native in Mr Cameron’s company.

Many will have thought that Coalition Government would be about Conservatives instigating policies and Liberal Democrats holding back the nastier Tory tendencies but the reality is proving more complex.

Over the weekend senior Liberal Democrat figures were actively trying to paint their party’s role in Government, behind closed doors at least, as being about ensuring the Lib Dem’s distinctive signature on every policy this Government puts through. On the BBC this weekend Simon Hughes was keen to make sure people understood that “ …there are lots of times when Nick will say ‘No, not now, or not this way’…or they’ll [Lib Dem ministers] be saying we need to go further, faster or differently”. I’m not sure whose fears that is supposed to allay. Its cold comfort for party members already uncomfortable on a whole raft of issues, already the word ‘dictatorship’ is being bandied around by the grassroots.

When you add public opinion that they don’t like large strands of Government policy, the question emerges: is it Cameron’s lot to blame or Clegg’s?

So far the Conservatives seem to be happy to acquiesce Clegg’s political muscle flexing but the future post-conference, especially the post-coalition agreement, looks stormier than ever. Already Saint Vince’s comments on the migrant cap have put him at odds with Teresa May, whilst Evan Harris has decided to put some distance between the ‘progressive wing’ of the Lib Dems and Clegg (though that distinction should probably have been made clearer to Lib Dem voters).

The Lib Dems are now tarred with very cut, every policy, and all the rhetoric of this Coalition Government. Why shouldn’t Labour cover them with feathers call them what they seem to be?

This puts a little pressure on Labour as it journeys up to Manchester. Thousands of new Labour members are actually Lib Dem voters angry at being sold a duff political project and by the end of this conference there are likely to be many more of them ready to  follow their lead.

But it is a very different scenario if uneasy Lib Dems MPs and councillors are, after a week in Liverpool, pushed/shoved/encouraged to search for a more comfortable political home.  What will Labour be ready, or able, to offer them?

We must stand by our NHS

In this guest post, Young Fabian member Martin Edobor argues that we might fight the proposed changes to the structure of NHS service provision in the UK, or risk undoing many of the improvements Labour achieved in its time in government.

Upon reading the Coalition Government’s NHS white paper, I was both shocked and dismayed with their plans to restructure the NHS. The proposals are likely reverse the progress that has been made under Labour, where the NHS delivered a new level of health and equality to the people of Britain.

One of the major proposed changes is to give GPs the power to commission the vast majority of health services for patients, which would result in the closure of Primary Care Trusts (PCTs) – the bodies currently tasked with commissioning healthcare from NHS providers. At this moment in time a reorganisation would be the wrong direction to take; in this period of financial uncertainty, the NHS requires stability.

Michael Dixon, Chair of the NHS Alliance, has argued that only 5% of GPs are ready to take over commissioning. While the chief executive of the NHS, Sir David Nicholson, has suggested that the quality of current GP practice-based commissioners isn’t at the level which would be required to transfer commissioning to them under the proposed timetable. At this moment in time, most GPs are simply not prepared nor ready to commission services for their communities. By pushing forward with this reform, the Coalition Government are placing the quality of GP services at risk.

Another major announcement is the increase in patient choice of providers, but this is likely to lead to privatisation by the back door. Allowing private firms greater opportunities to win NHS contracts may result in a two tier system, where those with money will be able to receive better care than those without.

Edward Davies, editor of BMJ Career Focus, claims that the white paper was ‘expected and little more than a logical continuation of 13 years work from the previous government’. He couldn’t be more wrong: the British public did not vote for a re-organisation or privatisation of the NHS. For that reason we must do all we can to oppose this white paper, in order to maintain the quality of the service the NHS provides.

Cameron and the spirit of Stanley Baldwin

In this guest post, Young Fabian member Laurence Turner reflects on the historical comparisons made with the current coalition government.

Nick Clegg would have us believe that we live in an age of reform comparable to the 1830s, but in truth it feels more like the 1930s.

On May 12th, David Cameron announced that the Conservatives and the Liberal Democrats had ‘overcom[e] political differences to forge a new government in the national interest.’ This was powerful rhetoric, but the words were of a different age. They could easily have been uttered by a triumphant Stanley Baldwin almost eighty years earlier.

As historical actors, Baldwin and Cameron strike a similar pose. Both modernisers, both easy media performers, both leaders of anti-Labour coalitions. It seems from his speeches that Cameron is taking Baldwin’s style of leadership seriously, and so should we.

Like Cameron, Baldwin transformed the Conservative Party from a sectional organisation, ill-equipped to appeal to a changed electorate, into the dominant force in British politics. Most importantly, he successfully established his Party’s ‘non-political’ credentials and, by way of contrast, associated his opponents with the stigma of factionalism.

Of course, ‘non-political’ appeals are by their nature political, and inclusive rhetoric can be one of the most effective means of excluding and marginalising opposition groups. Baldwin spent almost ten years building a contrast between the ‘National’ Conservative Party and a ‘Socialist’ Labour Party – a strategy which provided the National Government with its rhetorical clothing.

There is a present danger for Labour here.

As Philip Williamson has argued, after 1931 ‘appeals to national interest, national unity, equal sacrifices, and responsibility overwhelmed those to socialism, social justice, and class’. The proof is striking: the National Government ticket won the 1935 General Election with 53.3% of the vote. Labour must engage more meaningfully with values and ideology, but if we phrase our appeal too narrowly then we will be similarly outmanoeuvred. The Left’s intellectual renaissance during the thirties needs to be emulated today, but that in itself was small compensation for a decade of Tory ascendancy.

Cameron and Clegg will try to emulate this achievement. The Left must develop the arguments needed to prevent this from occurring. History provides us with one small example: how can this be the ‘New Politics,’ when even the rhetoric has been lifted from the era of the Great Depression?

Of course, the parallel is inexact, and the contrasts are encouraging. Labour is not so hopelessly fractured as in 1931, and Cameron – though he has taken to coalition life well – does not seem as formidable an opponent as Baldwin. In terms of grand vision, for example, the Big Society is weak stuff compared to the enduring appeal of the Property Owning Democracy.

The spectre of The National Government does, however, help us to define the scale of the challenge that must be overcome if we are to see a genuinely progressive government back in Number 10.

The government is right to address the pensions issue

Firstly, let’s separate out two different issues relating to pensions – the pension entitlement (essentially a benefit), and public sector pensions (part of a contract between the government and its employees). The Coalition government has made proposals relating to both this week, which is likely to confuse the issue of how specific measures might decrease deficit spending/government liabilities.

Both are Pay As You Go (PAYG) schemes – where current payments are funded from the contributions of those who currently work – and both will become more difficult to fund in future years, largely for demographic reasons.

The are several problems for governments looking to tackle the issue of pensions – for example, people often don’t know the true value of their pension entitlement as it relates to a period a long way in the future; and older people are disproportionately vocal on the issue because it affects them currently, but any concessions we make to existing older generations makes it harder to rectify for future generations.

On State Pension Entitlement, the medium-term choice facing government is harsh – restrict pension entitlement to a shorter period of people’s lives (by raising the age at which the entitlement kicks in), or spread the benefits more thinly (i.e. pay less to each pensioner each week). It really is as stark as that, and the problem will get worse as the baby-boomers start retiring in this decade. (PwC did a good report on the impact to public sector debt if we don’t address this structural problem – and it would make the financial crisis look small by comparison). It is understandable in the context of better healthcare and the fact people are more active to a later stage in life that delaying the start of the benefit, rather than cutting the value of the benefit to each individual, is the preferred route.

I always thought Labour could and should have done more whilst in power to address the impending pensions crisis. I’m glad that the current government is speeding up measures announced by Labour, and thinking of going further. Linking the age at which state pensions kick in to average life expectancy – a measure which the current government is looking at – is a bold move, but one which I would support. Such a link reduces the downside financial risk to government/taxpayers of having to fund pensions over an ever increasing period of time, and ensures what limited resources are available to pensioners go further. Aligning the retirement ages of men and women is right and we should also make it easier for older people to carry on working, if they want to.

Of course, some of the problems which may occur in future in relation to state pension affordability will be directly consequence of measures they propose to introduce – in particular, the cap on non-EU economic immigrants will reduce the UK’s ability to afford pensions, for example by preserving the replacement ratio (roughly the ratio of the working age population to pensioners). This is another reason why that particular barmy proposal ought to be opposed.

As young people, it is important we contribute to the debate. After all, we are the generations which will have to fund baby boomer pension entitlements as well as face reduced entitlements ourselves. The short-sightedness (or selfishness?) of older generations isn’t a mistake we should repeat. When you add in funding our university education, environmental problems, and the massive transfer of wealth to them via housing stock, I think we are entitled to feel short-changed but it is important to address structural issues in our pension funding to avoid selling future generations down the river. (See David Willet’s book The Pinch for more on some of these intergenerational travesties).

Public sector pensions, on the other hand, are an altogether different beast.

There are a lot of arguments thrown around about public sector pensions – that they are lavish, ’gold-plated’, or act as compensation for employees who accept lower current wages than would be payable in the private sector. The truth, of course, is a little more complex.

In my own experience I know of people who have left private sector jobs to joint the public sector and who have secured higher pay, better pension entitlement and have to work a lot less for it. There is some evidence to suggest that the pay gap between private and public sector jobs has narrowed considerably over the last ten or so years, with a concurrent fall in public sector productivity. However, I think the worst excesses are mostly confined to management level positions, rather than more junior and frontline positions (nurses, firefighters etc). We should be careful not to assume that all public sector workers have it good.

In the context of a reduced number of current contributors to state pension funds (i.e. a smaller government workforce) as well as the demographic burdens of promises to older generations, it is understandable that the government want to limit the liability to the Treasury (i.e. the ‘unfunded’ bit of current pension payments). However, addressing this issue will be much harder for them than the state pension issue for a number of reasons:

• pensions are contractual entitlements, which would make it hard for the government to change already committed entitlements (which means they are unlikely to reduce current pension costs);
• changing pension benefits for new employees (for example, switching to average salary schemes) would not have a direct benefit to the public finances until those workers retire – possibly several decades;
• trade unions are likely to oppose any material changes to existing workers, and possibly new workers.

Making existing members of pensions schemes increase their payments into the scheme would be challenging, but probably the least worse option. Likewise, it might be possible to reduce the entitlement existing members accrue in future. Both are likely to meet strong opposition.

The tribal response to the appointment of John Hutton to chair a review into into public sector pensions was incredibly disappointing, and trivialises a very serious issue for the UK. It is likely we will need cross-party support for any measures to make public sector pensions affordable. Labour should be at the heart of those debates and contributing to the development of policy on those issues. Far from being deriding him for being a “traitor”, Labour should welcome Hutton’s appointment and make the most of his involvement.

After all, we can’t afford not to.