Lobby of Tower Hamlets Pension Committee over Clarion & Riverside breaking promises

This evening I went to make a submission to Tower Hamlets Council Pension Committee with a UNISON colleague, Julie. Both of us use to work for Tower Hamlets Council as housing officers. Julie worked in the Isle of Dogs and I worked in Bow.  In 2005 Julie and her colleagues were tupe transferred into what is now called Riverside Housing Group. 

I was tupe transferred  in 2007 into what is now called Clarion Housing Group. At the time of transfer all of us was promised by our new employers, that we could keep our entitlement to a Council Pension scheme. I am the only one left in Clarion who use to work in Tower Hamlets and Julie is only one of 5 left in Riverside from these transfers. Other Clarion UNISON members are in the London Merton fund, Cambridgeshire, Norfolk, Kent and Surrey.

Now, Clarion have decided to go back on its promises to around 60 of its staff and similar promises to keep a decent pension scheme for another 220 staff. They are planning to enforce this by "Fire & Rehire" dismissal process on 1 December 2023. 

Riverside have only just started a "consultation process" but it is clear from the paperwork I have seen that they boast they have got rid of similar pension promises before and no doubt they fully intend to do the same again.

We pointed out that if organisations break their promises to their staff, then Councils will be concerned that they will also break promises to residents, planning committees and strategic partners. 

We were allowed to make a short verbal submission and leave a briefing note. Many thanks to the Chair of the Committee, Cllr Kabir for allowing us to speak. Also to all the Councillors present, who make it clear their dissatisfaction with what is going on and that they have other serious concerns about Clarion and Riverside as landlords. 

In particular, Cllr Rachel Blake and Cllr Abdal Ullah, who pointed out that there are also long standing concerns about Clarion breaking past promises and they moved that Council officers should investigate this issue and the Committee should write to Clarion and Riverside. 

Julie made by far the most important submission by pointing out she had 37 years of service (I have only 30) to residents and she had been planning to retire in 3 years time. If this proposal goes ahead it will wreak her pension plans and due to her age she will have no time to make up the loss. 

"Emergency motion passed unanimously at branch executive over Clarion Housing Group “fire and rehire” dismissals and breaking pension promises"

Check out 

 "On 5 September 2023 Clarion sent dismissal notices to 54 of its most long serving staff in order to close down its defined benefit pension provision. Clarion has made it clear that that it staff do not “consent” then they will be deemed to have left the organisation without compensation.

The extremely hostile and threatening nature of Clarion communications has already led to 200 staff being bullied out of the schemes.

Some of the staff impacted have over 30 years’ service with Clarion and its predecessor employers and many of these staff have had their pension plans destroyed since they will not have enough time (or income) to make up the difference.

The staff impacted had joined Clarion in the past because they promised a defined benefit pension or had been tupe transferred from councils and promised that they can keep these pensions.

Clarion have refused to disclose information relating to the costs of closure, but we believe that cuts to staff terms and conditions are behind this action at a time that Clarion has recently published that it made an underlying surplus (or profit) of £185 million last year.

The Chief Executive Officer of Clarion earns around £450,000 per year. This is nearly 3 times what the UK Prime Minister earns. If these changes, go ahead she could earn £45,000 per year in pension contributions, which is more than most staff in Clarion will earn in a year.

Members in Clarion have recently voted in an indicative ballot to take strike action over pensions and also in a separate ballot a majority of all members voted to take strike action over pay.

This branch Executive resolves to:-

1. Send a message of solidarity and support to all Clarion members facing this fire and rehire dismissal.

2. The branch secretary to send a strong message to the Clarion Chief Executive and Chair of the Board demanding they withdraw these threats. Copied to Council leaders and MPs of every authority that Clarion has a presence.

3. Sends an appropriate motion to UNISON Regional Councils, Community Conference and our National Delegate Conference.

4. Request that UNISON Labour Link does everything possible to put the case against these “fire and rehire” dismissals with the Labour Party in line with the “New Deal for Workers” policy commitments.

5. Organise and pay reasonable expenses for members to attend a lobby in October at the House of Commons of their MPs. To work with other branches and regions who have members impacted to encourage them to do the same.

6. To send information to all our branch unison shops (other London Housing Associations with publicity, asking for them to show solidarity and join appropriate and legal protest action that the branch deems necessary".

"What lies ahead for housing associations with pension obligations?"

 

So check out this report by https://www.socialhousing.co.uk/comment/comment (pay wall) May 24 2023 that DB pensions obligations "likely to have reduced by more than 50%" and due to surpluses in the Local Government Pension schemes "We expect significant reductions in net balance sheet FRS 102 obligations"

So why is Clarion Housing Group wanting to close its DB Pension provision, breaking legal promises to its staff and condemning them to poverty in their old age? No wonder there will be a strike ballot next week.

"There is a lot for housing associations to consider this year end with respect to defined benefit (DB) pensions accounting.

This is set against the context of rising interest rates and DB pension obligations likely to have reduced over the year to 31 March 2023 by more than 50 per cent.

The net balance sheet position, however, will be very dependent on a scheme’s investment strategy and how the supporting assets have fared over what has been a very volatile year.

First of all, the income and expenditure (I&E) service cost for the 2023-24 financial year is likely to fall for those still open to the build-up of new DB benefits.

This could perhaps be by as much as 60 per cent or more, but the change in interest cost is again dependent on investment strategy and the net deficit or surplus position.

However, there are a number of factors to be considered depending on the circumstances of the housing association, including those set out below.

Divergence between LGPS and SHPS

With asset values holding relatively steady for those in the Local Government Pension Scheme (LGPS), we expect significant reductions in net balance sheet FRS 102 obligations for many housing associations.

In fact, many organisations in LGPS may have assets exceeding liabilities on an accounting measure and, for the first time in a while, will be looking at whether a balance sheet pensions surplus can be recognised.

For housing associations in the Social Housing Pension Scheme (SHPS), the reduction is likely to be smaller as investment hedging strategies will have dampened the net effect of rising bond yields..."

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https://www.socialhousing.co.uk/comment/comment