Official Report: Minutes of Evidence

Committee for Finance, meeting on Wednesday, 21 April 2021

Members present for all or part of the proceedings:

Dr Steve Aiken OBE (Chairperson)
Mr Paul Frew (Deputy Chairperson)
Mr Jim Allister KC
Mr Pat Catney
Miss Jemma Dolan
Mr Philip McGuigan
Mr Maolíosa McHugh
Mr Matthew O'Toole
Mr Jim Wells


Mr Jim Quinn, Fire Brigades Union
Ms Nuala O'Donnell, Irish National Teachers' Organisation
Ms Alison Millar, Northern Ireland Public Service Alliance
Mr Dessie Lowry, Royal College of Nursing Northern Ireland

Public-sector Pensions: Northern Ireland Committee, Irish Congress of Trade Unions

The Chairperson (Dr Aiken): I welcome Alison Millar, Dessie Lowry, Jim Quinn and Nuala O'Donnell. Is Alison leading the briefing?

Ms Alison Millar (Northern Ireland Public Service Alliance): Yes.

The Chairperson (Dr Aiken): OK, Alison. Thank you for answering. Representatives of the Northern Ireland Committee of the Irish Congress of Trade Unions (NIC-ICTU) are with us to provide an oral briefing on the views of trade unions on the proposed changes to public-sector pensions and the associated anticipated legislative consent motion (LCM). Alison, are you happy to go ahead? We have Jim on-screen.

The Committee Clerk: We had Dessie, but we have just lost him.

The Chairperson (Dr Aiken): Are you happy to continue, Alison?

Ms Millar: Yes, sorry, Chairperson. Do not worry; you were not breaching any confidences at the point that I came in. That is general knowledge in the Department of Finance.

I thank the Finance Committee for inviting us to discuss the issue. It is obviously very important to members across all the public-sector pension schemes. We do not have a whole lot to say; that is covered in a very brief overview, which we sent to the Committee. I am sure that it is in your packs.

There are three issues that we would like to address. The first is resources. As I am sure the Committee is aware, part of the remedy for the age discrimination that appeared between 2012 and 2022 is rectifying that period of time. That will require all the schemes to have sufficient resources in order to allow, as we understand it at this point, manual calculations to be made by people who really understand pensions. Certainly, the situation has improved slightly, but we would welcome the Committee's intervention to ensure that, moving forward over the next number of years, all public-sector schemes are fully resourced in order to deal with the outworkings of the deferred choice underpin, which is what all the unions under the central consultation working group (CCWG), collectively and separately, agreed is the best way to address the age discrimination that appeared during that time. I am sure that most Committee members are aware of that. It means that the discriminatory element will be dealt with at the point of retirement by giving a choice to scheme members. They will be told, "Had you stayed in the legacy scheme, this would be your option, and had you moved to the new scheme, that would be your option". People can therefore have an options choice at that point, and we think that that is the best way to handle the issue.

That leads me on to the potential tax issues that arise from the deferred choice underpin. The issue, in simple terms — this applies to not just high earners but to people across the public sector in all schemes — is that when you retire, you will be told, "If you had stayed in this scheme, this is the lump sum and pension that you would receive, and, in the other scheme, that is the lump sum and pension that you would receive". Most people, being human beings, will opt for the scheme that delivers them the best lump sum and the best pension. However, we are all human beings and all have our own tax issues.

Given that the age discrimination was not caused by scheme members, we believe that the Government, either the Assembly or, what is more likely, Westminster, should pay for the age discrimination. We are not blaming the Assembly or the Finance Committee of the day for it, because it was implemented at a UK level. Therefore, we believe that, when people come to retirement, they should get free, independent financial advice in order to ensure that they make the best decision that suits them not just at the point of retirement but throughout the rest of their life and for as long as they live. That is a really important issue. I am sure that the Committee agrees that, if the Government make a mistake, it should not be the scheme members who then have to pay for it. What we want to ensure is that, over the lifetime of the schemes, people are given proper tax advice so that they do not end up making a further decision that impacts on them financially.

At this point, I will hand over to my colleague Jim Quinn, who will address the legislative consent motion.

Mr Jim Quinn (Fire Brigades Union): Thanks, Alison. First, I thank the Committee for taking the time to meet us. This is important to our members, particularly those in the Fire Brigades Union, because we are the people who have, either rightly or wrongly, been blamed for bringing this case and all that that has happened since it has been resolved.

Our chief concern about the legislative consent motion is that the legislation on pensions was devolved and dealt with by the Assembly back in 2014 and 2012 via primary legislation. We believe that that should be examined and that we should go through the same process again. That will allow for better scrutiny, more transparency and Northern Ireland-specific changes that may be required. I say "may be required" because we are unaware what the Westminster proposals are; they are not due until May or June, we believe. Until then, we will not know exactly what the proposals are. Our question — given that we are not legislators, this is a big question — is this: if an LCM is used to make changes in order to remove the discrimination, which, as the Minister points out, needs to be done, how will amendments be made to address peculiarities in Northern Ireland-specific schemes or issues that do not happen not in GB? Will that be done via another LCM from Westminster? Can local politicians in the Assembly amend that?

We are not sure. Part of the reason the Minister gave was to do with delaying the removal of discrimination. Our fear is that, if we do not get it right the first time, there will be a longer delay, or we may find that issues have been left out or there are issues that we have to have amended. What would cause the delay is a bit of a chicken-and-egg problem.

We understand that, at the minute, an LCM is the way forward for the Department of Finance and the Minister, and we ask that they take a closer look at that to see whether it is the most appropriate and best way to amend the legislation in order to remove discrimination.

If there were some help from the Finance Committee or others, that may be able to tell us what would happen if an LCM were enacted and we found a deficiency in it in that it does not address some of the NI-specific issues. Can it be amended? Will that take longer? What happens if the House, either Westminster or here, is not in session? Will that cause further delay?

We have not been given any answers to those questions. We are probably asking the wrong questions. Essentially, at the moment, we do not believe, because we do not have enough information, that the LCM is the most appropriate way to do it, either for transparency or scrutiny, and, more importantly, for getting the whole thing right rather than for trying to get it through quickly.

That is all that I have to say on that at the moment. Thank you.

The Chairperson (Dr Aiken): Thank you very much indeed for your statements. I have a couple of questions. Obviously, with McCloud pension reforms, you suggest that we should proceed through the Northern Ireland Assembly via primary legislation rather than via a legislative consent motion. That is what I take from you, Jim. Are you arguing for primary legislation because you want the Assembly to amend the Westminster legislation, or what particularly are you trying to secure through primary legislation? If that is right, what amendments would you like us to secure?

Mr Quinn: The whole problem is that we are not aware of what the Westminster legislation is going to be and what the changes in the LCM are. We have differences in Northern Ireland, such as different schemes and cross-border bodies, that we do not have in GB. Therefore, there are issues that will potentially not be addressed by the Westminster LCM. Although, in saying that, it could be just a simple way of getting the higher-level changes made, and the local stuff can be dealt with later. We are not sure.

Also, because we have devolution of pensions, we believe that they should be in the hands of local politicians in case those sorts of issues need to be addressed and so that people on the ground can speak directly to you, as we are doing now. That would make for an easier, more succinct, more transparent and, possibly and probably, a more accurate and speedy resolution to the process. There are a number of reasons why we suggest that, but, mostly, we are suggesting it because we are in the dark about exactly what the LCM will contain.

The Chairperson (Dr Aiken): I see. The Department of Finance argues that if the Executive brought forward their own pensions reform Bill and it deviated from the Westminster legislation, such an approach would leave them liable to legal challenge from public-sector pension members in Northern Ireland, whereas if the Executive simply replicated the Westminster legislation, prospective plaintiffs are more likely to challenge HM Treasury in the courts. Do you accept that argument?

Mr Quinn: There is a potential for that, but I do not accept that that is a reason for going down that route. We are not suggesting that we want any special or different treatment; we are suggesting that, in order to make a full and proper assessment of what is going on, we need to see the legislation and we need our local politicians to see whether it fits with their view of what local pensions should look like. I do not think that we are going to be jumping on some train to take them back to court if they take that route. That is not our intention. Our intention is, quite clearly, to get this right. If you consider enacting legislation that we do not know the exact impact of if there are any Northern Ireland peculiarities, that is a reasonable position to take.

Of course, if the LCM can go through and it covers all the bases, I am sure that that could be dealt with by the Assembly as well by looking at it before it decides whether to take it through as primary legislation or to follow the Westminster LCM. There is still time to do one or the other.

The Chairperson (Dr Aiken): Thank you very much indeed.

Mr Wells: Once again, I declare my chairmanship of the Northern Ireland Assembly Members' pension scheme and membership of the trustees for 17 years.

I do not know whether you have been following the very clear evidence that we have been receiving from the Department on the issue. The Committee has gone into the matter in considerable depth. I am sure that you are aware that Wales and Scotland have decided to go down the legislative consent route, and they feel that there is absolutely no option for having bespoke legislation for their own jurisdictions.

Given that and given the fact that the Treasury has made it very clear that if we step out of that route we, through the Northern Ireland block grant, would have to meet that extra expenditure, what is the merit in separate legislation, when, really, our hands are tied?

Mr Quinn: We are not necessarily asking to blindly refuse to use an LCM. I am not completely au fait with the parliamentary process or procedures, but when Westminster publishes the LCM, there may be some time before that to assess whether an LCM is appropriate and whether the measures taken in the GB LCM would suit Northern Ireland pensions. All that we are saying is that there may be Northern Ireland peculiarities. We took decisions back in 2012 and 2014 to proceed with certain pension schemes in some different ways to our GB colleagues, and we want to be sure that those peculiarities are addressed through the LCM if necessary.

We are not suggesting that we go through a different process in Northern Ireland just for the sake of it. It may be that the LCM is the most appropriate route, but we have not seen it, we do not know what is in it and we would prefer that the local Assembly scrutinise it. Whether that is by using the LCM process first or by using primary legislation remains to be seen. We have said that we want it through primary legislation, but, presumably, if the LCM covered all the bases, discussions could probably take place. That may be something that we could reflect on and come back and speak to the Finance Committee about.

The Chairperson (Dr Aiken): You mentioned Northern Ireland-specific peculiarities and peculiarities to the Northern Ireland pension schemes a couple of times. Will you outline what those peculiarities are? That would probably help us in formulating our thoughts.

Mr Quinn: I can comment only on the Fire Brigade scheme. One example is that we have a different retirement age from our colleagues in GB. I presume that that will not be impacted by the LCM, but I cannot be sure. I also understand that we have some peculiarities in that we have cross-border bodies that employ people and that those bodies may not have the same conditions or work with same legislative issues that are required in GB.

All we are saying is that there are peculiarities and differences. I am not aware of all of them, but it would be pertinent to look at the LCM to see whether there are any differences that we need to reflect on and have a closer look at. I cannot name them all, to be frank, but those are two examples.

Mr Wells: Scotland is —.

Ms Millar: Mr Chairperson, could I come in on this point?

Ms Millar: The issue is for all the trade unions and scheme members. At this point, it is like saying, "Hold your nose and jump into something". Anybody would and everybody should accept that, until we see the Westminster legislation and the read-across in the LCM, we will be nervous about potentially agreeing to an LCM blindfold when we have not seen it. Maybe the CCWG trade unions could suggest that when we see the Westminster legislation and what the LCM looks like, we either come back and address the Committee or if we have no issues and are content for it to go through an LCM, that could be done by correspondence, if that would help the Committee.

The Chairperson (Dr Aiken): We are like you; we do not know what is going to be in it. One question that we have asked out of Committee and that I have asked the Clerk is this: what are the timelines? We do not know what the timelines are. One of the things that I will ask the Committee to do after this is to write to the Department for an update of when the timeline is likely to be.

Ms Millar: Sorry for cutting across you, Chair, but the latest information that we have after asking the Department is that it may be late May, but it could be June. That demonstrates that there is no clear timeline at this point. We are fearful of the summer recess kicking in, and then there will be a very short time frame. For all those reasons, we have not made the final decision that we are absolutely wedded to primary legislation. We do not want to determine primary legislation or an LCM without having all the full facts. I think that we are agreeable on that.

Mr Wells: That reaction is very helpful, Alison. I will just explain some of the technical issues that are at this end. As far as getting it through during this mandate is concerned, the Speaker has ruled that no legislation can be tabled in the Assembly after June. Indeed, legislation that is tabled in June will do very well to get through this Assembly before we dissolve for an election. Therefore, if we do not go down the LCM route, the difficulty will be that the witching hour here is 31 March 2022, when those —.

Ms Millar: Sorry, Chairperson, I do not know whether other people can hear Jim, but he is cutting out quite a bit, and we are getting only —.

Mr Wells: I have to say that no one has complained that they cannot hear me in my entire political career. [Laughter.]

A Member: Quite the opposite.

Mr Wells: Yes, they might have complained that they could hear me but not that they could not.

The Chairperson (Dr Aiken): Alison, if you are having problems, I can ask Jim to move a bit closer to me. I can disinfect my spot and move round.

Ms Millar: Perhaps my colleagues can hear OK and the problem is at my end.

Mr Wells: Can anybody hear me?

Ms Millar: You sound like a dalek.

The Chairperson (Dr Aiken): Perhaps you could give us one second to allow the honourable Member for South Down to manoeuvre.

Mr Wells: This is where the permanent secretary normally sits. I wish I had his salary. Can you hear me now?

Ms Millar: Yes.

Mr Wells: Just to go back, as far as our position is concerned, the Speaker has ruled that he will not accept any draft legislation after June because it will not get through during this mandate. Our difficulty is that the witching hour for this legislation is 31 March 2022, when all those who were entitled to be upgraded to the final salary scheme will be upgraded to that date and then everyone will go on to the same scheme as a result of McCloud judgement. The danger is that, if we go down the primary legislation route, we will not have it through in time for that crucial date.

Secondly, we will be watching the LCM very carefully, and if we spot any of the concerns that you raised, we will take them up with the Department. We are not going to blindly rubber-stamp something. It is still up to the Assembly to decide whether it accepts the LCM, so it is not a done deal in that sense, but it would be very difficult for us to backtrack given the fact that all the other legislatures in the UK are going in one way and one way only.

Ms Millar: That is helpful. We understand the issues about the timing. There are concerns on the Committee side and with us, but let us see the Westminster legislation. We are not fundamentally opposed to an LCM, but we do not want to say today that there should be an LCM in case we see something in the Westminster legislation that we think is imperative that we bring to your attention and to the attention of the Department of Finance. We would like to leave that space open so that we can either correspond with you or come back to the Committee. My fear is that the Westminster legislation will potentially come out just before the summer recess, and where will that leave us all? Even at a UK level at Westminster, that is leaving everything very tight.

We are not wedded one way or the other; we just want to see it, as I am sure the Committee does, in order to ensure that there is not something in it that would disadvantage in any way any member of the Northern Ireland schemes.

Mr Wells: We are relying on you to let us know if you spot something. We already had an issue raised by police officers who are unhappy with what is happening, and there may be others out there who are in a similar situation. However, you are sharp, and if you spot something, I know that you will let the Committee know. We are not trying to steamroller this through either, because we had to discuss whether to go down this route, but the evidence that we received from the Department was overwhelming in saying that we had to go down this route unless something dramatically changed.

The Chairperson (Dr Aiken): Are you there, Maolíosa?

Mr McHugh: I am sorry, Chairperson. It is OK. My questions have been answered.

Mr O'Toole: I just want to follow up on some of Jim and the Chairperson's questions on the Northern Ireland-specific anomalies. You mentioned that you are not opposed to the principle of an LCM. Alison, will you give us an overview of what you think those specific issues are? Which ones are at the top of your mind that you are concerned about?

Ms Millar: Jim addressed those concerns about two schemes. One is the cross-border bodies' scheme and the other is the different retirement ages in the fire scheme, which are not the same as those in the Westminster legislation. The four of us who are here today are not representative of all the schemes. Perhaps the best way to address your question would be to write to you on behalf of the CCWG in the next week or two.

Mr O'Toole: That would be really helpful. May I just confirm that your hope is not that we amend the primary legislation here to make it, for example, materially more generous, as much, as a good social democrat, as I would like to be able to do that? Your ask is not that we have our own primary legislation in order that we diverge to have much greater generosity, is it?

Ms Millar: We hope and anticipate that the legislation will be very narrow. Its purpose is not to address the whole of the public-sector 2014 schemes. Therefore, we do not believe that the Westminster legislation should touch any of the issues that may be specific to certain schemes, such as the fire scheme having a different retirement age, or the cross-border bodies' scheme being slightly different. It should just be about the remedy. If that is the case, the remedy should be the same across the four nations. I believe that we would be content, at that point, that an LCM could address that. If the legislation strayed wider than that, that is where our concern would be.

Mr O'Toole: If it is the Department of Finance's preference that that not be the case and that it just does an LCM, is the Minister aware of the specific concerns and is he writing to Treasury or whomever to make sure that what you described does not happen?

Ms Millar: We have raised that with the management side through the negotiating machinery, that is, the CCWG. We have made that very clear. The information that we are getting is that the expectation of the senior staff in the Department is that the legislation will address only a very narrow focus. However, we are suspicious of the whole issue of pensions, and we just want to make sure that the legislation does not stray into areas that would be detrimental to any scheme member in Northern Ireland outside of the age discrimination element.

Mr O'Toole: I declare retrospectively that, as well as my Assembly pension, I have a UK Civil Service pension.

The Chairperson (Dr Aiken): I should also declare retrospectively that I hold a pension from the Ministry of Defence.

Mr O'Toole: You will be claiming yours sooner than me, Chairperson.

Mr Wells: I am sure that both carry substantial pensions.

The Chairperson (Dr Aiken): It is not substantial enough.

Mr Catney: On the back of that, you said that the remedy should be the same across the four nations. However, I note that the Department has indicated that a further valuation of public-sector pensions is under way. How does that sit with your analysis, Alison, that the remedy should apply across the four nations?

Ms Millar: Scheme valuations are a different matter. That is mentioned in paragraph 3 of our short briefing note. At this point, our position across all the schemes is that, if there is a cost to correcting McCloud, the age discrimination element should not be picked up by scheme members. Valuations have been carried out for some of the 2016 schemes. For some of the schemes that I have knowledge of, like the Civil Service scheme, there were improvements for scheme members, such as a better accrual rate and changes to death-in-service benefits. That was replicated across a number of schemes, and some of my colleagues may want to come in to give you some examples.

We are only starting to get this information, so we do not have it for all schemes, but I was very recently made aware that the actual cost of rectifying McCloud in the Northern Ireland Civil Service pension scheme, for example, would be in the region of 4·8%. The better accrual rates and better death-in-service benefits were part of the 2016 valuation, which was halted and not implemented. It is very clear, therefore, that scheme members will now be asked to take the hit and pay for something that was not their fault. We want to study that in more detail as the valuations come out for each of the schemes, and we will write to the Committee when we have a concrete position on that. I am sure that you would all agree that, if somebody does something wrong that you have no control over, you should ultimately not be asked to pay for it. That is the trade union side's position.

We are just starting to get those scheme valuations, and, again, I suggest that we write to the Committee when we have a clearer picture across all the schemes. We will be more than content to come back to address any specifics about those valuations.

Ms Millar: Some of my colleagues have more detailed knowledge. Dessie has detailed knowledge of the health scheme and may be able to articulate some information about it if that would be helpful.

The Chairperson (Dr Aiken): Alison and Dessie, you mentioned 4·8%. Is that 4·8% of those who are likely to be affected by McCloud or is it 4·8% of the overall pension budget? What does the 4·8% specifically relate to?

Ms Millar: It is related to what is called a floor breach or a ceiling breach. If the figure is more than 2% below or above either of those, it needs to be addressed. At this point, the valuation of the Civil Service scheme is coming out at 5·3%. The 4·8% figure is the remedy of McCloud. The 2016 valuation of the Civil Service scheme has been done, and scheme members were to benefit, certainly until the next valuations, but they will not get the benefit of that. I will maybe provide you with a written explanation of that. Dessie is on the advisory board for the health scheme and will be over the detail better than I am.

Mr Dessie Lowry (Royal College of Nursing Northern Ireland): Apologies for the technology at the start, Chairman. The rehearsals went well, but, unfortunately, it did not go so well when I went to execute it. It is a great opportunity to be able to address the Committee.

I co-chair the health scheme advisory board along with a management representative. In November 2008, after the scheme was assessed and the costs analysed, we were in a position to make recommendations to the Minister. The first was that we change the way in which we harvest the money, basing it on actual pay rather than whole-time equivalents in order to make it much fairer for active members. We also sought to index link the boundaries for scheme contributions. There are seven bands, and we wanted to index them so that, if somebody moved from one band to another, they did not end up with a pay cut as a result of having a higher contribution rate. We also wanted to take out the last three of the higher bands and migrate them to a rate of 12·5% in order to try to improve medical and dental retention in particular in the scheme.

On survival benefits, we recommended that all active members equalise as of 1 April 2015. We also had room to make recommendations about reducing the contribution rate across the board by 1% and increasing a new benefit that would build up cash for a lump sum. They were important.

As Alison said, the cost-benefit analysis is now being readdressed by valuations. The Government Actuary's Department is analysing the data. We have not seen it. However, if it takes into account members having to pay for McCloud, we estimated that we would need 34 new staff working in pension administration to support that, not including the departmental staff required. You can see that members will have to pay for that. In principle, we are against that. We are not in any way saying that the direction order is wrong per se; we are saying specifically that the cost cap recovery for McCloud is inappropriate.

As you can see, the benefits that we recommended to the Minister in November 2018 could be wiped out if we cover the costs for McCloud. It is an issue. However, until we see the data, we will not know.

Mr Wells: There is a world of difference between 1% and one percentage point. One percentage point is a 9% increase in the levy on the Exchequer, if you can understand the difference. If I go from 2% to 3%, that is not a one percentage point increase but a 50% increase, if you understand the difference. Whilst it sounds attractive to say 1%, it is not. It is one percentage point, which is much higher.

Secondly, as far as our own trustees are concerned, we are simply asking Members to pay, to the last penny, what they would have paid had they been allowed to remain in the final salary scheme. In other words, had they remained in the scheme, their contributions would have been 12% rather than 9%. We have gone back to 1 April 2015 and said, "What if MLA Smith or Jones had stayed in the final salary scheme? What would he or she have paid?" That is reasonable, because they would have paid that money anyway to accrue those benefits. They had the choice to stay in the final salary scheme or to go into the career average scheme.

What is unreasonable, then, about asking civil servants to pay exactly what they would have paid had they been allowed to stay in the final salary scheme?

Mr Lowry: One difficulty is that, across health, there are two effective pension schemes. The 1995 and 2008 make up one scheme, and then there is the 2015. Once you got into significant issues of administration, the pension scheme administrator advised us, it was going to be very difficult to state that if we had pension contributions that were changed from 1995, there would be different ones for 2008 and 2015. We have always taken the view, across the management and trade union side, that you should have the same contribution rate no matter what scheme you were involved in.

Mr Wells: Are you saying that, even though the final salary scheme is so much more lucrative and attractive when you retire, you should not pay an extra contribution towards it?

Mr Lowry: The 2008 and 1995 scheme, which is the final salary scheme, will end. Members will still benefit from contributions, but, under the new direction, as a result of the consultation, those who are still working will be moved over to the 2015 scheme.

Mr Wells: I think that the Department will find it very hard to justify not asking those who have been taken out of a final salary scheme and then put back into it to pay the amount that they would have been asked to pay had there not been the decision that McCloud overturned. What you are saying is that you are going to get seven years' worth of a final salary scheme, but we are not going to ask you to pay for it. No Assembly could stand over that. I am sorry, but it just could not.

Ms Nuala O'Donnell (Irish National Teachers' Organisation): Chair, can I come in?

Ms O'Donnell: The teachers' scheme is very different. The contribution rates for all teachers were increased under the 2014 Act. Basically, to get an increase of 9·6% across all teachers, it could be anything from 7% right up to 11%, depending on the salary that you were receiving. That increased from 6·4% depending on whichever point you were at on the scale. Whether you were in the final salary scheme or

[Inaudible owing to poor sound quality]

was irrelevant. One of the issues here is that all the public sector schemes are very different. The teachers' scheme is much simpler than some of the others that I have had heard of. However, there is no issue that, regardless of whether you are in the final salary or

[Inaudible owing to poor sound quality]

scheme in this, you are paying exactly the same contributions and have been since that was introduced and they were all increased in 2015.

The Chairperson (Dr Aiken): Thanks very much. Jim Quinn, do you want to come back in?

Mr Quinn: Yes. Nuala has hit the nail on the head: the schemes are all very different. Firefighters pay 15% in the old scheme. What Mr Wells says is correct: we will be expected to recoup that additional payment compared to the contribution under the new scheme, which is 10% or 12%, depending on what salary you earn. If we buy back into the old scheme, the legacy scheme — not "buy back" but are put back in — we would have to give the money back to cover what the contributions should have been at 15%.

To go back to the real point about the cost cap evaluation, the Fire Brigades Union is taking further legal action on this. We have issued judicial review proceedings, essentially, because the cost control mechanisms relate to the cost of the 2015 scheme. The cost of correcting discrimination relates to the pre-2015 schemes. What the Government are trying to do is make the people in the post-2015 schemes pay for the discrimination. That is not what the Government intended in 2014 when the cost control mechanisms were debated and passed through Westminster. We believe that it is potentially unlawful. We are still challenging that element of it, because you are, in effect, making one group of people who are not benefiting pay for the cost to someone who is benefiting. It is essentially unfair and potentially unlawful. That is the difference as I see it.

The Chairperson (Dr Aiken): OK. Thanks, Jim. Is there anybody else? No. Before we finish, I have a quick one for Alison. We have heard reports that the Northern Ireland Civil Service pay deal is to be about 1%. Would you like to comment on that? The Minister has talked about a Civil Service policy for working from home, post pandemic. Have you any views on that as well?

Ms Millar: Yes. On the Civil Service pay, in the past few days, we have been made an offer of 1% plus a 1% non-consolidated payment for 2020-2021, and — this is the broad bones of it — 1% for 2021-22. The representations that NIPSA and the FDA made directly to the Minister were on the basis that we were looking for parity with our teacher colleagues, who, certainly for 2020 — I forget what year we are in sometimes — 2020-2021, got a 2% consolidated offer. We were looking for the same applicability. That did not materialise. Civil servants are very disappointed with that. We are now out to a branch consultation with members on the current offer, which will close on 14 May. I must admit that I have asked the Minister on a number of occasions, at meetings and in writing, "What is the difference?". Teachers have played an important role in children's education in the difficult circumstances of the past year. What is the difference with civil servants? That is the thing that sticks in the throat of many civil servants, who have gone above and beyond to continue to provide services during the pandemic. You asked the question, so, if the Finance Committee wants to make those representations to the Minister and the Executive, we would be very grateful for that.

As regards working from home post pandemic, we are now on our second draft of a working from home policy. A revised copy arrived with us just yesterday. We are working intensely with management side to top and tail it and are hopeful that it will be implemented in the very near future. We are content that we are making progress to ensure that, whether it is a blended approach or it addresses issues for people who do not want to, or who cannot, work from home, all those issues are addressed, including the thorny issue that, for many members who were working from home, there were additional heating costs, particularly during the winter months. As you know, about 12,500 civil servants earn below £24,000, and, therefore, heating their homes while working at home has been very difficult for some. We hope that we can crack that nut, as we have not been able to do so to date.

I assure the Committee that NIPSA is working intensely with management side on a working from home policy for "the new world of work" that we thought would never be realised: when we asked previously about working from home, we were told, "No". A significant number of members are in daily or on a regular basis . For example, about 3,000 of some 8,000 staff in the Department for Communities are in daily or on a regular basis. I assure the Committee that we are working intensely on a working from home policy. I say "working from home", but I think that it is "remote working", because it is not necessarily about working at home but in the hubs that are being developed across Northern Ireland.

The Chairperson (Dr Aiken): Thanks. Jim, did you want to come back in?

Mr Allister: Yes. Carrying on from that, our next briefing is from the Department on the reform management programme. Do the unions have a view on that with regard to the impact of the pandemic on the Department's need for office estate and, indeed, the connect hubs? Is the Department working with the unions on it? What is your take on it all?

Ms Millar: Through the central Whitely arrangements, there is what is called an "accommodation committee". That is the rightful place for all issues of accommodation and hubs. For example, we have made representations for the mid-Ulster/Magherafelt area where there is no hub. We think that one could be beneficial both to the Department and to workers who live in the area. We are actively engaged in seeking to address the needs of members, first and foremost, but also the needs of the Civil Service in the new world in which we are working. We want to ensure that issues come to us in appropriate time for meaningful consultation, rather than when decisions have already been taken.

The Chairperson (Dr Aiken): Thank you very much, indeed, Alison and your team, for coming along and giving us your take and time.

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