RESISTING THE RAISE IN RETIREMENT AGE?

TRADE UNIONS IN BRITAIN AND GERMANY AND THE DEFENSE OF PENSION RIGHTS

Julia KlitzkeUniversity of Mannheim, SFB 884 "The Political Economy of Reforms"

Project A6: Welfare state reform support from below: linking individual attitudes and organized interests in Europe

L13, 17, 68131 Mannheim, Germanyklitzke@uni-mannheim.de

Abstract

Governments all over Europe aim to limit future pension expenditure in ageing societies by requiring people to work for longer. However, this rather economic tool popular among reformers is highly unpopular among the working population and their representatives. This paper investigates the different positions that trade unions as the representatives of working people have taken in the debate on raising the retirement age. It focuses on The United Kingdom and Germany, representatives of two different types of welfare states and countries that have passed legislation increasing the future state retirement age to 66/68 and 67 respectively.

Trade unions as the organisations defending employees' rights have been critical of raising the retirement age, and British and German trade unions are no exception. However, there has been an apparent difference in their reactions to these reforms during the legislative process and thereafter. While German trade unions continue to campaign on reverting the retirement age of 67, in recent British pension disputes the retirement age has arguably played a minor role for unions in comparison to other issues.

This is an explorative examination of the positions these organisations take towards government policies that raised the state pension age. I conduct a qualitative analysis of interviews carried out over the course of 2011 with representatives of the organisations. My working hypothesis is that despite similar views on higher retirement ages in principle and similar concerns regarding equality, the different institutional setup of the Bismarckian social insurance versus the Beveridgian basic pension system plays out in different strategic responses. I will further investigate whether these differences hold true for all union organisations or whether particular trade unions are outliers.

Introduction

In times of permanent austerity and ageing socities, governments all over Europe aim to

limit pension expenditure by requiring people to work for longer. However, this rather

economic tool popular among reformers is highly unpopular among the working population

and their representatives, the trade unions. In a complex reform landscape, the raising of

the statutory retirement age is a clear retrenchment measure, offering the same type of

benefits for more years of contribution.

In this paper, I analyse the positions of trade unions in the United Kingdom and Germany,

representatives of two different types of welfare states and countries that have passed

legislation increasing the future state retirement age to 66/68 and 67 respectively. German

and British trade unions are no exception from trade unions all over Europe in finding

retrenchment reforms aimed at their members unappealing. However, there has been an

apparent difference in their reactions to these reforms during the legislative process and

thereafter. While German trade unions continue to campaign on reverting the retirement

age of 67, in recent British pension disputes the retirement age has arguably played a minor

role for unions in comparison to other issues.

This paper is based on interview data gathered for a larger comparison of European pension

reforms and the role of organised interest groups. Representatives of trade unions were

interviewed in one-hour semi-structured interviews on a number of recent pension reforms.

These representatives were either 'political representatives' (chairpersons, members of the

council, etc.) whose portfolio included pensions policy or the 'pensions expert'

(spokesperson, pensions officer) of their respective organsation and I regard them as experts

on the position of their organisation on pensions. Methodologically, I have extracted all

materials relevant to the reform aspect in question and sorted the answers into thematic

units (Meuser and Nagel 1997: 488f.). I want to investigate if there are differences between

how British trade unions and German trade unions responded to the raising of the statutory

retirement age and, should there be significant differences, consider possible explanations.

Regarding terminology, in this paper I am only looking at the retirement age in the sense of

the statutory retirement age, or state pension age, not the 'actual' retirement age at which

people leave the workforce, regardless of whether this coincides with what their legislators

intended them to do. This distinction is important (Hill 2007: 103), but in the interest of

readability I will use 'retirement age' as a shorthand for that age at which you are expected

to retire by law and can expect a full state pension without cuts in return.

Unless otherwise indicated, all quotes come from the set of interviews carried out in 2011.

All translations from German to English are my own.

The changing pension landscape in Germany and the United Kingdom

The British pension system appears, over the last thirty years, to have been in a constant

state of reform. In the liberal welfare state that is the United Kingdom, the state pension

arguably plays a smaller role for many pensioners compared to occupational pensions, with

the basic state pension a relatively modest flat-rate benefit, and additional state pensions

(SERPS, state second pension) being less attractive for medium to high earners than private

or occupational provisions (Schulze and Moran 2007: 60). But what the system lacks in

generosity it makes up for in complexity, with different types of reforms and provision

measures grafted onto each other, and various types of pension entitlements continuing to

exist parallel to each other, long after the original program for accrual has been abolished.

Germany, in contrast, was long seen as incapable of reform, and certainly when it came to

welfare state retrenchment, especially trying to cut back on the enormous expenditure on

the German state pension. With the "virtue of stability" apparently turning into the "vice of

stagnation" (Kitschelt and Streek 2003: 1) there was not exactly a strong belief in the reform

capacity of the German welfare state, especially around the turn of the century (see also

Häusermann 2010: 126). But perhaps contrary to expectations, the German welfare state,

and pensions in particular, saw paradigmatic changes in the years of the Red-Green

coalition, and further retrenchment measures down the line (Hinrichs 2010: 47, see also

Bleses and Seeleib-Kaiser 2004) that were wildly unpopular and opposed by such interest

groups as the trade unions.

One type of pension reform that has taken place in both the United Kingdom and Germany is

the raising of the retirement age, or state pension age. It is in fact a measure that has been

passed or attempted by many European governments, as most of them feel the pressure of

rising welfare budgets and the financial strains of demographic aging. But reactions to the

change have varied considerably, from public protests, marches and strikes in some

countries to relatively calm, if grudging, acceptance in others.

The pension woes of Germany and the United Kingdom have slightly different accents. The

United Kingdom has, compared to most continental European countries, a much lower

pension expenditure, and projected state spending in the future is significantly less (Banks

and Smith 2006: 41), with some grounds for assuming that the British pension system

around the turn of the century was basically financially sustainable (Emmerson 2003: 168).

In contrast and not unrelatedly, it has a bigger problem with pensioner poverty (Ogawa and

Takayama 2006: 177). Germany on the other hand does – currently – not have a pensioner

poverty problem, but before the reforms of the early 2000s it was looking at projected social

insurance contributions for pensions of well over 30% of gross wages in order to finance its

relatively high state pensions in a time of demographic change (Hinrichs 2010: 53). Still their

efforts to curb state expenditure by extending the period of life spent in employment are

comparable, with a higher state retirement age introduced at roughly the same time, with a

roughly similar timeframe.

This measure aimed to shift the balance between time spent in employment and time spent

in retirement somewhat back from the way this balance had been developing in recent

years. Unlike other pension reforms with a more complex field of winners and losers, a

higher retirement age for the same level of benefits is a clear retrenchment measure, and

the expectation that trade unions will oppose this is obvious, as it will have a direct impact

on their membership, who will have to work longer to receive the same they did before.

The trade unions

There are significant differences between German and British trade unions, and they are

obviously relevant for a comparison of their reaction to a policy measure. German trade

unions, due to their involvement in the state pension self-administration and the high

importance of the state pension, have always been considered an important player in

pensions politics. In the United Kingdom, with the greater weight on private provision in

pensions, this is not the case (Anderson and Meyer 2003: 26, see also Ebbinghaus 2011).

In both countries, the unions have suffered from membership decline and diminished

political importance. For British unions, this process began in the early 1980s, a process that

left the unions concentrated in the public sector (Addison et al 2010: 2ff, see also McIlroy

and Daniels 2009: 98). But in Germany as well, trade unions have gone from being effectively

a veto player in pensions (Schludi 2008: 63) to being powerless to avert cuts and a paradigm

change in the state pension system, managing to secure only a few appeasing concessions

(Wiß 2011: 153ff). In Britain, on the other hand, the strength of occupational unionism in

fields that are still union-organised should not be disregarded (Oude Nijhuis 2009: 303). In

both countries, unions have responded to these pressures by merging into larger unions

(Ebbinghaus 2004), and the history of one particular union is often the histories of several.

In the following, I will analyse how these different trade unions react to the raising of the

retirement age.

As interview partners were chosen first the (main) peak organizations, the Deutscher

Gewerkschaftsbund (DGB) and the Trades Union Council (TUC). Further interview partners

were from member trade unions, which were chosen from different sectors and with a

different membership make-up, with an aim to reach the 'bigger' trade unions in terms of

membership, but also different types of unions.

For the United Kingdom, these are:

TUC (Trades Union Council)

UNISON Member of the TUC. Organizes exclusively in the public sector.

NUT (National Union of Teachers) Member of the TUC. Teachers' union, exclusively public sector.

CWU (Communication Workers Unions) Member of the TUC. Originally postal workers' union, used to be exclusively public sector, now also organises in large private telecommunications firms.

Unite Member of the TUC. Comes out of merger of public sector union and general union.

GMB Member of the TUC. Organizes in public and private sector. Notable for resisting merger process.

USDAW Member of the TUC. Organizes in the private sector, primarily low-income earners, many part-time workers.

For Germany:

DGB (Deutscher Gewerkschaftsbund)

ver.di (Vereinte Dienstleistungs-gewerkschaft)

Member of the DGB. Organizes in the service sector, relatively high percentage of women members and low-income earners.

GEW (Gewerkschaft Erziehung und Wissenschaft)

Member of the DGB. Organizes teachers and other education professions, mix of civil servants and employees.

dbb Beamtenbund und Tarifunion Not a member of the DGB. Organises civil servants and public sector employees.

The interviews in Germany were hampered by timing problems; interviews with the IG

Metall, IG BAU and IG BCE are still planned but could not be carried out before the deadline

of this paper. With its dominant role within the DGB, the IG Metall would be particularly

relevant (Anderson and Lynch 2007: 201). I will be including references from the other

interviews where they describe the missing unions. While this means that the interview

material is more plentiful on the side of the British trade unions, given in-depth interviews

with the umbrella organisation and a fairly wide spread across the trade union spectrum, I

consider the emerging themes and commonalities and differences still rather revealing.

Retirement age in Germany

Until 2012, the legal retirement age in Germany for a full pension was 65, but early

retirement policies and the generosity of the replacement rate had for years worked as

incentives to retire even before 65 (Börsch-Supan 2000: 29). The legislation to raise the

retirement age from 65 to 67 was passed in 2007 while a grand coalition between the

Christian Democrats and the Social Democrats was in office. As a measure to reduce the

strain on the budget and limit the shift of the dependency ratio towards a greater number of

pensioners versus a shrinking number of people in work, raising the state retirement age had

been recommended in 2004 by the Rürup commission, but was not adopted by the Red-

Green government (Schulze and Jochem 2007: 694). It was not until after the federal

election in 2005, which resulted in a one-term grand coalition, that plans to raise the state

retirement age were announced by the Minister for Work and Social Policy Franz

Müntefering, SPD, who played a major role in bringing about this reform (Schmidt 2010:

310). This new legislation would raise the retirement age from 65 to 67 for men and women

alike, in incremental steps starting with cohorts born after 1947; the first new pensioners

affected by this measure are those retiring in 2012, at 65 years and one month. Retiring

before the state retirement age will still be possible, but will entail cuts of up to 14.4% in the

state pension.

The legislation contained an exception for workers who have been working for 45 years, who

will still be able to retire at 65 without cuts to their pension. It also contained a provision for

a review of the legislation in 2010 with an eye towards the employment chances of older

workers; this review has since taken place and the government has found the employment

chances of older workers on the rise and the retirement age of 67 necessary and feasible.1

This raising of the state retirement age was hugely unpopular among the German public. Up

to 70% of the population in West Germany and 80% in East Germany were against it in 2007

(Scheubel et al 2009). The trade unions in general strongly opposed the reform as well, while

the employers' organisation considered the measure long overdue and disagreed instead

with the exceptions for people with 45 working years (Wiß 2011: 176), a late concession to

the SPD social policy wing close to the unions.

State pension age in the United Kingdom

In the United Kingdom, the state pension age for men born before 1953 is 65 and for women

born before 1953 between 60 and 65. The Pensions Act 1995 aimed to equalize the state

pension age between men and women, raising women's state pension age to the same as

men's, i.e. 65, from 2010 (May 2010: 133). This equalization was sped up by the Pensions Act

2011, aiming originally to reach a state pension age of 65 for women between 2016 and

2018.2

The Labour government's Pensions Act 2007 then intended to raise the retirement age for

both men and women first to 66 (by 2020) and eventually to 68 (by 2046). The Conservative-

Liberal coalition that replaced Labour in government in 2010 sped up this process in general,

too, and final legislation on the exact timeline is still outstanding. Nevertheless, the direction

of the state pension age – up – is clear, and a state pension age of 66 and eventually 68

seems unavoidable, regardless of whether it will be realised in 2018 or 2020.

Raising the state pension age was one of the recommendations that came out of the

Pensions Commission, an advisory body set up in 2002 to look at the state of British pensions

and come up with possible solutions to a perceived looming pension crisis.3 Its second

report, published in 2005, recommended a mix of a higher retirement age, more private 1 Bericht der Bundesregierung gemäß § 154 Absatz 4 des Sechsten Buches Sozialgesetzbuch zur Anhebung der Regelaltersgrenze auf 67 Jahre. 17.11.2010. <http://dipbt.bundestag.de/dip21/btd/17/038/1703814.pdf> 08.08.2012.2 Protest over a too-rapid rise in women's state pension age has led to this measure being currently in flux. For the most current state of pension ages in the UK, see Directgov, the government's digital service for England and Wales (http://www.direct.gov.uk/en/Pensionsandretirementplanning/StatePension/DG_4017919).3 The Commission consisted of Adair Turner, formerly Director General of the Confederation of British Industry, Jeannie Drake from the TUC, and John Hills, professor of Social Policy at the London School of Economics and worked from 2002 to 2006.

savings, and higher government expenditure, a mix that was meant to address both the

problem of financial sustainability of state pensions under demographic pressure and the

problem of people making insufficient pensions provisions and risking poverty in their

retirement. The Pensions Commission had originally preferred a flexible retirement age that

would generally rise with life expectancy, but this did not translate into legislation (Hills

2006: 665ff).

Analysis – Germany

In the interviews with the German trade unions, four themes emerged in the analysis of the

unions' positions on the raising of the retirement age. One was maintained and strong

opposition, with one exception. The second was that a change in strategy had taken place in

light of political realities. The third was the role the membership played in forming the

organisation's position. Fourth was the role that collective bargaining might play in the

future for the question of when people retire.

1. OPPOSITION (OR NOT)

DGB, GEW and ver.di interviewees all express strong opposition to the higher state

retirement age of 67, and the issue has high salience for them and their membership. There

is no sense that this matter is not 'relevant' for the membership; the main argument against

the higher retirement age is the assumption that most people represented by these unions

cannot work until age 65, much less 67, and that the higher retirement age is thus nothing

but a pensions cut, as people who cannot work any longer and have to retire before they

reach 67 will be punished by life-long deductions in their state pension.

"Ver.di has always been the trade union protesting the retirement age 67 the loudest, and it's our official position, and still very current from last year's federal congress, that we demand the retirement age 67 be abolished […]"

ver.di

"We continue to regard [retirement age 67] as a wrong decision." DGB"We fundamentally consider a raising of the retirement age a wrong signal." GEWThe retirement age continues to be a matter these unions' memberships feel strongly about

and that the unions' official spokespeople are compelled to oppose.

The dbb takes a different position, its interviewee explicitly pointing out a distance from the

DGB trade unions: "This is not a position you're going to hear from any of the DGB unions,

but we're not strictly opposing [retirement age 67], but consider it a rather understandable

policy measure, especially when it's likely that only a part of the higher life expectancy will in

fact be passed on as a longer working time." In contrast to the other union interviewees,

they also emphasise that society as a whole will have to reconsider its view on aging, and

adjust its mental image of 65-year-olds and 67-year-olds. The stress on the experience and

the ability of older workers to contribute to economic growth – and the waste of phasing

workers out unnecessarily early – is a theme that is in stark contrast to the emphasis of the

other trade unions in the sample and their emphasis on older workers' inability to still work

in their jobs. (While the employers are not part of this analysis, it is interesting to see in the

data that goes beyond the trade unions that the overlap in argumentation is very high

between the dbb and the BDA when it comes to the view of older people in the workplace

and changing views of what 'old' looks like.)

2. STRATEGY CHANGE: EMPHASIS ON WORKING CONDITIONS

This theme is found in the interviews with the unions opposing the higher retirement age. A

perhaps surprising result, in light of the general media representation of the trade unions'

position and a continued effort at opposing the higher retirement age,4 is that there seems

to have been a change in strategy within the DGB unions at least, a move away from

fundamental opposition to constructive not-quite-cooperation.

"The position regarding our view on retirement at 67 hasn't changed, but the strategy of how you deal with the decision for retirement at 67 has to evolve, of course."

DGB

"Internally, I have to be honest, we are also working very closely with the Ministry for Work on finding ways to stay healthy at work longer, […] because we know that in the long run, we are not going to be discussing rolling back the retirement age [67] but rather, from the point of the view of the trade unions, trying to prevent even higher retirement ages."

ver.di

All of the interviewees assume that the retirement age 67 is here to stay. The emphasis has

subsequently changed to pushing for measures aimed at allowing people to work for longer

and stay healthy in the workplace. In the DGB interview, this became clearest with an

admission that there will be "no new majorities" for undoing the retirement age legislation,

and that this realisation "has come to the trade unions at different speeds and has partly led

to different […] political emphases". The evolution of strategy discussed by the DGB

interviewee includes a two-tier track of political aims: on the one hand improved working

conditions (for "good and healthy work") and on the other becoming more creative with the

4 See, for example, DGB et al, "Rente mit 67. Vierter Monitoring-Bericht des Netzwerks für eine gerechte Rente," <https://www.dgb-bestellservice.de/besys_dgb/pdf/DGB25042.pdf>, 2010, 08.08.2012.

transfer from work to retirement, i.e. finding options for workers who will clearly not be able

to stay in the workforce until they reach 67. Those two tracks are "consensus within the

organisation."

Despite the generally different stance on the retirement age 67 as such, these two tracks are

argued for in the dbb interview as well. After the failure of previous early retirement

schemes to enable a gradual exit from work5, a better model for part-time work for older

workers is considered necessary. On the issue of age-appropriate working conditions, the

overlap with the DGB unions seems clear as well: "you can't just start at 60 to suddenly pay

attention to health and safety and age-appropriate working conditions." Instead, integrating

long-term sustainable working conditions ought to start for people upon entering the

workforce.

3. MEMBERSHIP

If the change in strategy is an indicator of influence logic at work, the commentary on the

trade unions' memberships' preferences show that the unions grapple with membership

logic as well. According to the interviewees – and this would be in line with opinion polls for

the public at large – the union members lean strongly towards opposition to the raising of

the retirement age. This is the case even in the dbb, which does not take the same 'official'

oppositional stance as the other trade unions.

"It varies. But generally you can of course say that people, and regardless of whether they're civil servants or pensioners or [employees], as a rule prefer to leave work earlier rather than later."

dbb

"We had a very heated debate last year in September, because there was a motion to introduce the retirement age of 62 [at our annual congress] […] and the danger was quite real, given how the mood was among our colleagues [the members], who said, we all can't do this until 67."

ver.di

"Finding our position on the retirement age 67 was and is easy. That is about good arguments, and it is also about what our members, not the 8 [member unions] but the 6.2 million members think."

DGB

"You have to see that a trade union is a member organisation. And when I see that 98% of my members say, oh god, I hardly know how to hang in there until 65, then I won't go and say, and no trade union is going to say, no member organisation is going to say, but for higher, political and theoretical reasons I will support this."

GEW

This is quite indicative of the feelings the unions' members have on this question, and that

particularly among the DGB unions, the instructions for the union leadership from below are

5 Most employees taking part in this scheme chose the 'block model', according to which they worked full-time for five years and left work five years early entirely, instead of the smooth transition that had been intended by the legislation. See among others Bonin 2009: 17.

clear. The DGB interviewee further expressed that it would have been "suicidal" of the

organisation to "blink somehow and act in any way differently than we did." It is clear that

these representatives consider the issue very salient for their members and that this has

compelled them to act in a certain way even in the face of political conditions that make a

success of their strategy look less likely. The strategy shift, a re-emphasis on mitigating the

effects of the retirement age 67 legislation, is fairly recent, and given the strength of the

unions' members' aversion to it expressed here, the unions' failure to get the new

retirement age repealed is perhaps an indicator of dwindling veto power.

4. COLLECTIVE BARGAINING AGREEMENTS

The most interesting theme with regard to the comparison with the United Kingdom – and

perhaps in general – is that the German trade unions in this sample have further turned to

collective bargaining agreements to mitigate the effects of this unloved legislation.

The IG Metall and the IG BCE, organising primarily in physically demanding jobs, are

traditionally strong on occupational pensions and have been working on occupational

pension models that would partly offset the change in state retirement age and still allow

workers to retire early.6 But collective bargaining seems to be becoming an option across the

board. For the dbb, special retirement ages that already exist for employee groups like

firefighters could be taken as a model for other very demanding work. The GEW laments a

decline in measures that allowed older teachers to work less, but has managed to negotiate

a collective bargaining agreement for kindergarten teachers that reduces older employees'

workload. But also ver.di with its heterogenous membership and strongest protest on

retirement age 67 has struck a collective bargaining agreement in the postal sector on age-

appropriate and aging-appropriate working, with an option to retire early after "saving up"

working time. Working with employers on concepts that allow early retirement in work-

intensive fields is described as an increasingly important option.

The DGB interview seems to suggest strongly that the focus has in fact shifted from repealing

the legislation to finding creative solutions outside of the state pension.

"We are still in the middle of [consensus finding]. Because there is simply so much growing out of the trade unions in terms of concepts of what you can do by way of collective bargaining."

DGB

6 DGB interview.

While, according to the DGB interviewee, there is disagreement on how much the state

should still be involved in potential early retirement schemes among the unions, this is the

newest idea threading through all the interviews, suggesting that it is pointing towards the

future.

A staggered state retirement age, with different retirement ages for blue and white collar

workers, on the other hand, does not find much support in this context and is explicitly

rejected in the ver.di and GEW interviews and not entertained as a possibility in the others.

Analysis – United Kingdom

In the interviews with British trade unions, the answers on the state pension age clustered

around three main themes. One was the question of relevance, and related to that was the

question of opposition or approval. Second was the concern over unfairness and equality.

Third was the question of the relationship between the state pension age and occupational

pensions.

1. RELEVANCE (OR NOT)

Looking at whether the trade unions opposed or supported the reform, there is no support

to be found. The opposition, however, does not appear to be very forceful, the issue of the

higher state pension age being described as less relevant by nearly all the interviewed trade

union representatives.

The TUC spokesperson argues that the TUC has taken an opposing stance on the raising of

the state pension age "because we do represent large numbers of very low-paid workers in

manual jobs who would be the ones who would lose out most if the state pension goes up,"

but admits that this is "an argument that has not been won," and that as an issue the raising

of the state pension age has not been actively discussed.

"So I think in the area of pension I can't immediately think of something that we count as a sort of resounding defeat, apart from perhaps the raising of the state pension age, except that's not something that we would have gone out and vigorously campaigned about."

TUC

"A lot of [our membership] had planned to retire at a certain date but that's normally linked to their occupational scheme. Because the occupational scheme provides more of the income, significantly more of the income than the state will."

GMB

"It's our view that the pension scheme for teachers shouldn't have a normal pension age higher than 65, we'll wait to see what the government department responsible for teachers says. The government's saying that employees generally should work until 68 for their whole pension but we'll see if we can persuade the Department of Education to make a specific exemption for teachers."

NUT

The quotes by the NUT and the GMB are exemplary for a theme running through most of the

interviews, which is that the state pension age is not seen as terribly relevant unless

occupational pensions become tied to the state pension age.

The one organisation expressing an ambivalent stance is the CWU, a union organising mostly

in the postal service, but also newer private phone companies that came out of the

privatization of state services like O2 and Vodafone.

"A part of the problem we have, double-edged sword this, is particularly in Royal Mail, we're a relatively low paid industry. [...] If you're going to get told that you're going to retire at 60 or you get the chance to work to 63, 64, 65, 66, there's an attraction, because your pension's not worth a lot, but actually you can carry on working, and earn the 20-odd grand that you were earning when you were 59 as opposed to the four grand pension you're going to get at 60, you think, well, why wouldn't I want to work til 60, and then when you're 60 why wouldn't you want to work til 61?"

CWU

The CWU representative was the only one to raise the issue of people preferring a raising of

the state pension age because they wanted to stay in employment longer as it applied to

their members, not generally low-income earners. It highlights the CWU's middle position

between being in a well-organized sector and having members in long-term employment,

but also lots of members on low incomes. The interviewee stated that this ambivalence was

the reason the CWU did not submit an official position on the state pension age, as the

organisation was internally split over it.

2. UNFAIRNESS / EQUALITY

The main arguments against a higher state pension age centered around the theme of

unfairness and inequality in life expectancy. The higher state pension age is unfair and

should be opposed as long as people in different working sectors, or even people in different

parts of the country, experience vast discrepancies in life expectancy, the argument goes.

"The argument from the trade unions was that [working longer] is not fair as long as there is differential life expectancy. So that in some parts of Britain and in lower socio-economic groups life expectancy is lower. So that, if you stipulate that, everybody has to work longer, people who are poor anyway and who are less likely to have occupational pensions to supplement their income, and less likely to have property and other assets will be the ones who will have to work longer and draw their state pension for a shorter time. So the unions as a whole have never subscribed to the arguments about raising the state pension age."

TUC

"No, I don't believe it should be raised. I recognise the challenge for governments not just in this country, you know, all over Europe and the world, people are living longer. But a mandatory increase in state pension age disproportionally impacts on the people at the lowest income levels in society, or regions where there are more people on lower incomes. So it's nothing more than a cut really in retirement income for those people."

USDAW

Again these are merely examples, and the CWU, the GMB, USDAW and UNISON expressed

similar viewpoints, the theme of unfairness towards workers in physically demanding jobs

being disproportionately affected by a higher state pension age threading through nearly all

of the interviews, regardless of the sector the union primarily recruits in. A staggered state

pension age depending on someone's type of work (white-collar or blue-collar) or when they

started working did not seem to be something under virulent discussion ("There's been talk

by some people about having a staggered one, [...] that there should be a different one for

people depending on when they started work. We don't now have a policy on that. It's quite

an interesting idea, whether it's workable…", TUC), though different occupational pension

retirement ages for particular types of public sector workers were being defended (NUT).

Nearly all interviewees stated that their unions were concerned about the issue of inequality

as it related to a higher state retirement age, though none of them – public or private –

indicated that the raising of the state pension age was something that could still be opposed

or that they were willing to oppose by means of protest, industrial action or similar.

3. AUTOMATICITY

"I think our problem is linking the public sector pension to the state pension age. It should be separate. You should know when you retire. I think we would be open to debate about what the state pension age might be. Ah, it's our issue would be linking it."

UNISON

"We have concerns about it in that that would be coupled with employers moving the retirement age of their own pension schemes, which means that access to a pension, means that people won't necessarily have the choice of whether they go at 65, they will have to continue working because if they stop working they can't get their pension until they're 67, 68, that's a problem."

Unite

A greater point of contention for more than one interviewee was the prospect of linking

occupational pensions to the state pension age. This issue had more salience for

interviewees from UNISON, Unite and the NUT, which organize exclusively or to a large

extent in the public sector; together with the statements on relevance of state pensions

versus occupational pensions from other trade unions in this sample, this suggests a

potential cleavage between workers in organised sectors, which are more likely to be

covered by occupational pensions, and workers in sectors that do not have occupational

pension provisions, and who are generally not represented by these trade unions.

The interviewee from UNISON further argued that a potential linkage between public sector

occupational pensions and the state pension age was "unfair", as that would mean public

sector workers, as opposed to private sector workers (with occupational pension coverage),

would not have a fixed and predictable date of retirement, but instead one that would rise

along with any future changes to the state retirement age. The interest expressed by

UNISON was the most clear indicator of a divergence between public sector workers (or at

least UNISON's members) and workers who would primarily rely on the state pension.

The preliminary findings of the trade unions in this sample and their position on the raising

of the state pension age show that there is serious concern among the trade unions, both

from a public sector and a mixed sector background, about the raising of the state

retirement age having repercussions for occupational pensions on the one hand. It is also

fairly clear that they see their members as less reliant on the state pension in comparison to

their occupational pensions. The purely public sector unions also tended to view it as unfair

that the retirement age for public employees should be on the table as an item of

negotiation again. NUT and UNISON both stated they considered the issue solved with the

pension compromise reached for the public sector in 2006/07. The TUC interviews, while

reflecting a clearer fundamental opposition to the raising of the state pension age, also

reflect the importance of public sector occupational pensions as a major battle ground for

the trade union movement as a whole, and the concession that "we know that the state

pension age will be going up. So...that is an argument that has not been won." The trade

unions in general are concerned about what the higher state pension age will mean for

people who are not covered by occupational pensions, but it is not a politically salient issue

for them.

Discussion and Conclusion

In the comparison, the most obvious difference between the German and the British trade

unions in this sample is how salient the issue of state retirement age is for the former and

how little relevance it holds for the latter. This is of course a reflection of the institutional

set-ups of the pension systems. In the German welfare state, the state pension is – still –

people's main source of income in retirement, and traditionally German pensioners were

able to maintain a standard of living on the state pension alone. This has never been the

case in the United Kingdom, so that they care far more about the conditions of the

occupational pensions can be seen as a consequence of that.

The degree to which the higher state pension age is not of political salience to the British

unions, however, might still be considered surprising. There is a contrast between how

'unfair' the measure is seen and of how little consequence it still seemed to be for political

campaigning, indicating a rather pragmatic rather than ideological approach. But this is not

significantly different from the German unions. Both the German and the British unions are

showing a rent-seeking perspective, focusing on the particular interests of their members.

However in the German case, the aims of the trade unions are more in line with what would

benefit (most) employees in general, whereas the focus of the British unions on protecting

occupational pensions is more contained to the actual occupational sectors.

Of course, this is a hypothetical benefit. Even the high and vocal degree of political agitation

on the part of the German unions could not undo the retirement age legislation. In fact, the

policy of the higher state pension age shows a relative powerlessness of the trade unions in

both countries, moreso even of the German trade unions, who opposed the changed

retirement age so fiercely and for so long. On this issue, they can hardly count as veto

players, or the political result would have looked very differently.

Interestingly, though, it appears that for the German unions, the issue of the retirement age

could potentially become a new source of strength and influence if the trend towards

circumventing the measure through collective bargaining agreements catches on. Given how

thoroughly unpopular the higher retirement age still is among the German public, it could

possibly boost the unions' relevance for workers and employees if the unions play an active

role in finding a way around having to work these additional years.

This is in fact the most interesting finding of this comparison. The British unions do not care

greatly about the state pension age because of the reliance on occupational pensions; the

German trade unions cared a great deal about the retirement age going up, but were unable

to prevent this. As a result, they are now turning to occupational pensions as an alternative,

and one where they can be the negotiating actors. This could be taken as an indicator of a

degree of convergence between the pension systems. But it will also be interesting to see

how developments in the future shake out, when these similarities seem to be happening

under largely different signs, with the British unions defending their occupational pensions in

their last strongholds – largely the public sector – and the German unions discovering this as

– perhaps – a new field of relevance.

Bibliography

Addison, John T., Alex Bryson, Paulino Teixeira, and André Pahnke, "Slip Sliding Away: Further Union Decline in Germany and Britain", IZA discussion paper, 2010.

Anderson, Karen M., and Julia Lynch, "Reconsidering Seniority Bias. Aging, Internal Institutions, and Union Support for Pension Reform", Comparative Politics 39 (2), 2007: 189-208.

Anderson, Karen M., and Traute Meyer, "Social Democracy, Unions and Pension Politics in Germany and Sweden", Journal of Public Policy 23 (1), 2003: 23-54.

Banks, James, and Sarah Smith, "Retirement in the UK", Oxford Review of Economic Policy 22 (1), 2006: 40-56.

Bleses, Peter, and Martin Seeleib-Kaiser, The Dual Transformation of the German Welfare State, Basingstoke 2004.

Bonin, Holger, "15 years of pension reform in Germany: old successes and new threats", ZEW Discussion Papers, No. 09-035, 2009, <http://hdl.handle.net/10419/27716>, 08.08.2012.

Börsch-Supan, Axel, "Incentive effects of social security on labor force participation: evidence in Germany and across Europe", Journal of Public Economics 78, 2000: 25-49.

Daniels, Gary, and John McIlroy (eds), Trade Unions in a Neoliberal World: British Trade Unions Under New Labour, Oxford 2009.

Ebbinghaus, Bernhard, "Changing Union and Bargaining Landscape: Union Concentration and Collective Bargaining Trends", Industrial Relations Journal 35(6), 2004: 574-587.

Ebbinghaus, Bernhard, "The role of trade unions in European pension reforms: From 'old' to 'new' politics?", European Journal of Industrial Relations 17(4), 2011: 315-331.

Emmerson, Carl, "Pension Reform in the United Kingdom: Increasing the Role of Private Provision?" in Gordon L. Clark (ed), Pension Security in the 21st Century: Redrawing the Public-Private Debate, Oxford 2003, 168-192.

Häusermann, Silja, The Politics of Welfare State Reform in Continental Europe. Modernization in Hard Times, Cambridge 2010.

Hill, Michael, Pensions, Bristol 2011.

Hills, John "From Beveridge to Turner: Demography, Distribution and the Future of Pensions in the UK," Journal of the Royal Statistical Society, 169 (4), 2006, 663-679.

Hinrichs, Karl, "A Social Insurance State Withers Away. Welfare State Reforms in Germany – Or: Attempts to Turn Around in a Cul-de-Sac", in Bruno Palier (ed), A Long Goodbye to Bismarck? The Politics of Welfare Reform in Continental Europe, Amsterdam 2010, 45-72.

May, Cornelia, Generation als Argument. Konflikte um die Rentenversicherung in Deutschland, Großbritannien und den Niederlanden, Frankfurt 2010.

Meuser, Michael, and Ulrike Nagel, "Das ExpertInneninterview. Wissenssoziologische Voraussetzungen und methodische Durchführung," in Barbara Friebertshäuser (ed), Handbuch qualitative Forschungsmethoden in der Erziehungswissenschaft, Weinheim 1997, 481-491.

Ogawa, Naohiro, and Noriyuki Takayama, "Demography and Aging", in Gordon L. Clark, Alicia H. Munnell and J. Michael Orszag (eds), The Oxford Handbook of Pensions and Retirement Income, Oxford 2006, 163-182.

Oude Nijhuis, Dennie, "Revisiting the Role of Labor. Worker Solidarity, Employer Opposition, and the Development of Old-Age Pensions in the Netherlands and the United Kingdom", World Politics (2009), 61: 296-329.

Scheubel, Beatrice, Daniel Schunk and Joachim Winter, "Don't raise the retirement age! An experiment on Opposition to Pension Reforms and East-West Differences in Germany", CESifo working paper, No. 2752, 2009, <http://hdl.handle.net/10419/30417>, 07.08.2012.

Schludi, Martin, "Between conflict and consensus: the reform of Bismarckian pension regimes", in Camila Arza and Martin Kohli (eds), Pension Reform in Europe. Politics, policies and outcomes, Abingdon 2008, 47-69.

Schmidt, Martin G., "Die Sozialpolitik der zweiten Großen Koalition (2005-2009)", in Christoph Egle and Reimut Zohlnhöfer (eds), Die Zweite Große Koalition. Eine Bilanz der Regierung Merkel, Wiesbaden 2010, 302-326.

Schulze, Isabelle, and Michael Moran, "United Kingdom: pension politics in an adversarial system," in Ellen M. Immergut, Karen M. Anderson and Isabelle Schulze (eds), West European Pension Politics, Oxford 2007, 49-96.

Schulze, Isabelle, and Sven Jochem, "Germany: Beyond Policy Gridlock", in Ellen M. Immergut, Karen M. Anderson and Isabelle Schulze (eds), West European Pension Politics, Oxford 2007, 660-710.

Streeck, Wolfgang, and Herbert Kitschelt, " From stability to stagnation: Germany at the beginning of the twenty-first century", in Wolfgang Streeck and Herbert Kitschelt (eds), Germany: Beyond the Stable State, London 2003, 1-34.

Wiß, Tobias, Der Wandel der Alterssicherung in Deutschland. Die Rolle der Sozialpartner , Wiesbaden 2011.