Nuclear winter of discontent?

Nuclear winter of discontent?

Nuclear decommissioning

After a reshuffle of responsibilities among Prospect's senior management, I recently took on some new duties – including taking the lead for members working in nuclear decommissioning.

It is a welcome return to working with excellent Prospect reps and branches who I last dealt with on a day-to-day basis as the national secretary in our Liverpool office some years ago.

The relationships with the other main trade unions in the sector (principally Unite and the GMB) are also very good and I believe that together we are an effective voice for employees in this industry.

However, this role will be extremely challenging in 2017 because important terms and conditions for workers in this sector are under attack.

Coordinating Prospect's response to these attacks will be one of my most immediate priorities in 2017.

Like most sectors, there are concerns around pay and skills and, of course, nuclear new build is a vital issue for members in this industry.

But the collective issues of immediate concern are the current attacks on redundancy compensation and pensions.

This is a fairly long blog, but I would urge all Prospect members working in nuclear decommissioning to read it to the end because of the importance of countering these attacks.

If you have any questions, please post them in the comments section or contact any Prospect rep or officer.

Redundancy compensation

It is important to be crystal clear about what redundancy compensation is (and is not). It is not, as a Government minister claimed, reward for failure.

It is paid as compensation when an employer lets an employee go because they no longer need that job to be done. It is a role that is made redundant, not a person; success or failure does not come into it (those are matters for performance appraisal or management).

Redundancy compensation is particularly important in nuclear decommissioning because there is a finite ultimate goal to make nuclear sites safe and, once completed, the workers will have succeeded in making themselves redundant.

In this industry, redundancy compensation is an important tool in retaining key skills until the end of planned projects.

In order to incentivise workers to commit to a job that they might complete at an age and in a location where it might be difficult to find equivalent alternative employment, employers in nuclear decommissioning agreed appropriate redundancy terms to achieve this aim.

For this reason (and because many workers in the industry are employed by companies operated by the private sector) no-one in the industry thought that the Conservative party manifesto commitment to cap redundancy compensation for public sector workers would apply to them.

It was only after the Conservative party won a majority in the 2015 general election and the Treasury launched a consultation on redundancy compensation for public sector workers, that it became apparent that the cap was intended to cover employees in nuclear decommissioning too.

I say consultation – but in truth the exercise, carried out over a month during the summer holidays, gave every appearance of being something of a sham. Despite the constraints imposed on responding, Prospect's submission set out comprehensive arguments why it was unfair and counter-productive to include this group of workers in the scope of the cap.

These arguments were reinforced by hundreds of members also taking the time to respond to the consultation and write to their local MPs. Campaigning by Prospect members and reps reached a peak with a lobby of MPs in Westminster Hall on the day of the last major Parliamentary debate on the primary legislation underpinning the cap.

This storify account gives a detailed summary of the lobby of MPs and the passage of the primary legislation in the Commons.

Gill Wood, Prospect national secretary with responsibility for Sellafield and Magnox members, gives a comprehensive account of the current position on the proposed cap in this video.

This issue is not settled. The scope of the cap will be determined by secondary legislation that is expected to be tabled early in 2017.

Members in this industry have cross-party support from a range of MPs. Prospect and the other trade unions will be coordinating one last push to exclude them from the proposed cap on redundancy compensation.

Pensions

First they came for redundancy compensation, then they went for pension benefits.

Employees involved in nuclear decommissioning could be forgiven for thinking this government has it in for them.

The government intends to consult on detrimental changes to the benefits in the defined benefit section of the Combined Nuclear Pension Plan and the Magnox group of the Electricity Supply Pension Scheme. The proposed changes would significantly reduce the value of pension that affected members would accrue in the future.

A letter from me to the minister and her reply give more details.

The proposals are outrageous because they:

  • contravene specific statutory pension protections
  • cherry pick the detrimental aspects of Hutton’s proposals for public sector pension reform and leave out the parts that would benefit members in the sector.

As with redundancy compensation, Prospect will issue guidance on responding to this consultation, on lobbying your local MPs and other ways to oppose the proposals.

I urge you to take the actions suggested. If we are to succeed, every member will have to play their part.

Next steps (what Prospect members can also do)

We face many challenges but our collective voice is strong and we can have a real impact on these proposals.

Of course, the more members we have; the more effective we will be. So please speak to colleagues who are not in a trade union about the importance of joining – it’s easy to join Prospect online.

Members will be able to influence these proposals for the better in many ways and we will be in touch about these shortly.

Members who live in the Copeland constituency will have a particular opportunity to have their voice heard in the coming weeks.

If you are a Prospect member working in nuclear decommissioning expect to hear a lot from me and my colleagues about these issues early in 2017!

Dai Hudd

Dai Hudd


Comments

  • Having received a redundacy reference value letter and having a define benefit pension protected by statute I felt secure in my roll in operating and now defueling/ decommissioning. I have made plans based on these promises knowing that I would be made redundant in my fifties. Many years ago I made a commitment to the NDA to operate and decommission their power station with these promises in place. Having honoured my end of the bargin and within two years of being made redundant the NDA and Government want to change the rules. I have written to my MP outlining the situation, I have read all the partiamentary debates and feel cheated by the lack of integrity that the politicians are showing regarding the effect of these changes on Magnox employees. The NDA and Government use the word TRUST whilst dealing with their workforce. Having kept to my side of the bargin I TRUSTED that the NDA and Government to honour the promises they made many years ago regarding my pension and redundancy terms. With two years left to redundancy and with two young children to support I have never felt more insecure. Having exhausted all reasonable augument the union must test the attack on the protected persons pensions in court and do whatever it takes to resolve the effects of the exit cap. I am extremely angry about this situation,  You will have my full support on whatever actions you deem appropriate to resolve both these issues.

    Disallusioned Employee.

    10 January 2017 15:18


  • Thank you Disillusioned Employee for your response. I am sure many of our members will sympathise with the comments you so eloquently make. Magnox employees were extremely effective in their lobbying around the Enterprise Act and we will be continuing efforts to exclude employees of nuclear companies from the redundancy compensation cap in 2017. We will be issuing guidance on how to respond to the NDA’s pension consultation on Monday. We will also be setting out what else members can do to assist in that campaign.

    Dai Hudd

    10 January 2017 15:19


  • This is the Blog I have ever done, but I feel the need to add my support and ask a question.

    I am not going to go into detail with how I feel with respect to the pensions and redundancy terms, other than to say I feel the same as the "Disallusioned Employee" (see above comment). 

    What I cannot understand is how is all this legal? 

    My understaning of a contract is that it can only be varied if both parties agree. 

    Why is this different?

    Keith Samuel Hill

    10 January 2017 15:19


  • • I am 53 years old (54 in January) • I started paying my pension at the age of 16 as an Apprentice at BNFL and have 37 years of continuous service • I will have built up 40 years of my pension in 2019 and would have accrued 44 years if I went on to retire on Jan 10th 2023. • I have maintained my commitment and loyalty to this company and this industry. I have worked diligently all my working life because I see the nuclear clean up mission as a vocation not simply a job. • I stayed at this company despite the attractions of working elsewhere or becoming self employed to earn £30, £40 or £50 per hour, simply because of my desire to build a career and not just to earn more money. • This was obviously further tempered by the attraction of a Final Salary Pension. • I am not a “fat cat” looking for a bumper pay off, I am simply a working man who wants the contract, which I entered into 37 years ago, to be honoured.

    Anthony A Fiefield

    10 January 2017 15:20


  • Keith / Andrew - thanks for your comments, I'm sure the sentiment is shared by the vast majority of your colleagues both in the companies you work for and all other companies across the NDA estate.

    You both raise (explcitly or implicitly) the issue of legality.

    The legal issues affecting the redundancy cap proprosal and the NDA's pension consultation are different (naturally enough as they are different proposals affecting different aspects of your terms and conditions), There will also be differences in the positition of different groups of members depending on a number of factors (eg whether they are covered by the Electricity Act or Energy Act).

    Prospect will closely examine whether any final proposed changes can be challenged on any legal grounds for any group of members.

    However it is important that we do not rely on the possibility of a successful legal challenge to the exclusion of responding robustly to consultations on these issues. We must lobby as hard as possible to influence these proposals for the better now because (1) there is never any certainty of success with a legal challenge and (2) the Government could potentially secure the approval of Parliament to change aspects of the legislation we might seek to rely on in a challenge (eg if we rely on the protection of the Energy Act, the relevant part of that Act could potentially be repealed by Parliament before our challenge was heard).     

    Neil Walsh (Pension Officer, Prospect)

    10 January 2017 15:20


  • I seem to recollect that some time ago SL (or BNFL at that time) applied for a payment holiday from the company portion of pension contributions due to the fact that there were sufficient underlying funds within the pension 'pot' to adequately cover the future pension 'burden' for employees on the books.

    Since all new starters are subject to the revised terms and the workforce size has diminished this burden has surely become less.

    A synic may argue that this move is freeing up the said surplus for other use?

    How do we find out what that surplus (and saving) is?

    Anyones thoughts welcome.

    Andrew Y Brown

    10 January 2017 15:31


  • Hi Andrew = what becomes painfully obvious the more one looks into this is that the proposals have very little to do with the cost of pensions across the NDA estate (which are falling and will fall significantly in the future) or the funding position of either of the schemes subject to this consultation (there is no issue with their funding levels). It's very hard to escape the conclusion that this is about achieving an arbitrary level of savings agreed between the NDA, HM Treasury and ministers and has nothing to do with the stated aims of fairness, affordability or sustainability.    

    Neil Walsh (Pension Officer, Prospect)

    11 January 2017 08:08


  • Whilst I am aware that my Union and others are campaigning in a legal sense to prevent any change to the pension scheme, and whilst I understand their arguments I am of the opinion that some form of change is inevitable. After all if the government is going to do something then there will be a way.

    My disappointment is the level of change to pensions and the far reaching impact it will have. The default change is a move to a CARE scheme as that is a cheaper scheme and the benefits would be lower, but not massively so. I could accept a CARE scheme if no further changes occurred. The problem is the NDA/Gov proposal also states that even with the CARE scheme, contributions will be raised by an average of 3.2%, so it could be more than that for myself. So now we are paying more for lower benefits! Further and even more serious is the pension age for normal retirement will be state pension age. For me that is currently 67yrs. I have read that there is a worst case scenario where my pension age could be 71yrs. That impact is massive and unjustified, as with a bit of mathematics I can see that if I did retire at 60yrs which is the current CNPP retirement date, whatever the CARE scheme value I have built up will be reduced by over 40% as I am taking the pension effectively 11yrs early. Even at 67yrs I would suffer over 30% reduction. It also means that the Government can effectively hold great power to save money and slash Nuclear pensions at any moment in the future by increasing the state pension age, whereby all the actuarial adjustments favour the government and in an instant many percent is further knocked off a diminished pension. It is monumentally unfair to have an “undefined normal pension age”. And it absolute stupidity and completely ridiculous to ask people to agree to it. I fear many workers do not understand the impact of this moving target age change.

    The booklet provide by the NDA “Pension Consultation Am Employee’s guide” is misleading. There is no way to work out the impacts to oneself which is unhelpful. Example 4 somehow shows that working to 68yrs old, the member gets significantly greater benefits on the CARE scheme than current final salary. I thought we are trying to save money so this is an odd example. What it also fails to illustrate is the member wanted to retire at 60yrs old as per current scheme then with a bit a mathematics I have calculated that he would have been retired for over 24 yrs before the higher paying CARE scheme caught up. And many studies show that working later increases the likelihood of early death. So the example completely favours the NDA/Gov, as the worker continues to 68yrs old, paying additional contributions all the time and gets to claim pension for a limited time as death is likely to be earlier. Again I feel workers without actuarial knowledge will see example 4 as a good thing, but in reality it is very bad.

    The other option for change is to a Pensionable Pay Cap, which in my opinion is more reasonable as original terms such as contribution rates and retirement age remain the same. To be fair, it should however begin in 2018, not 2017 and have the 2.5% cap from the beginning, not from 2020. Only I fear this option will not be taken up because all or most schemes have already been reformed to a CARE scheme, and with a Pay Cap scheme members will probably retire at 60yrs, which NDA/Gov seem to want to prevent at any opportunity.

    Roger Broughton

    11 January 2017 13:01


  • So here we are…8 and a bit years from retirement, 34 years’ service to the nuclear industry, both man and boy! I’ve changed jobs a number of times, changed Site Licence Companies even, but here I am, still working loyally and proudly within the industry. Casting my mind back, I remember being really worried when I heard about the breakup of BNFL more than ten years ago. One of the areas of concern in those days was pensions. We were told that we were no longer going to be working for a government organisation and therefore had to change schemes. All was well though, lots of workforce engagement with the terms “cast iron guarantee” and “underwritten in law” applied with vigour to every pension discussion at the time. Many within NDA will remember these guarantees.  I was left reassured, relying on those promises to form a plan for my future and that of my family. So 8 and a bit years from retirement, those cast iron guarantees that I relied upon appear to be in the process of being torn up. Consultation has started, with only two (financially very detrimental) options being tabled, and already 5 years into the 10 year protection date!  Why does it feel like a done deal already? With not long to go, I know that it’s just too late to financially recover before I retire. NDA, I absolutely relied on your guarantees and you have let me down.  

    Ian J Wills

    11 January 2017 14:38


  • I have recently lobbied my local MP (Sue Hayman, Workington) with the follwoing letter.

    (Others who are not lifelong members may have similar experience of being promised, upon joining the company form outside industry , that the company pension was a safe option).

    Any comments welcome:

    "Sue,

    having joined Sellafield in 2001, at the age of 38, following many years working in the local area, I was promised, via my contract, that a company pension would be provided.

     

    I was also advised that it would be advantageous to transfer any other pensions into this scheme, which I did.

    I was advised that my years accrued outside would only buy 3 years within their scheme.

    I transferred on this advice - giving a forecast total of approx 26 years at retirement age - hardly a fortune in pension terms.

     

    You will no doubt be aware that recent communications from the company have informed pension members that the company (via the NDA) intend to change this contract, with 2 options on offer.

    Their communication also stated that this change would become effective, retrospectively, from April 2012.

    I would like to challenge the legality of retrospectively changing the contract I entered into, without due consultation at that time (i.e. 2012)

    This has disadvantaged myself and my co-workers by an additional 5 years.

     

    As a lifelong citizen of west cumbria and worker at Sellafield I have stayed loyal to Sellafield and feel passionate that we have a duty to protect our community and the environment of the north west of our country from the unique legacy of hazards we deal with daily.

    I have personally rebuffed more lucrative offers of employment to fulfil this duty and feel betrayed that this loyalty is now being ignored.

    I believe that the current attack on the above terms and conditions will seriously undermine the loyalty of an increasingly disillusioned workforce and this will inevitably erode the experience currently held within the company to face the continued hazards and challenges on Sellafield.

     

    I would appreciate your support and those of your parliamentary colleagues with this challenge.

     

    Yours Sincerely.

     

    Andrew Brown

    Commissioning Manager (THORP and MAGNOX)

    Sellafield"

    Andrew Y Brown

    21 January 2017 09:53


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