Government ad agency COI is axed

23 June 2011 Last updated at 13:07 GMT The COI was behind memorable public information films such as "Charley says" The government is to close its Central Office of Information (COI) with the loss of up to 400 jobs.

The agency - which commissions public information films and government advertising and publicity campaigns - was set up in 1946.

Trade union Prospect said there had been no consultation or warning to staff about the likely redundancies.

The COI's London head office will bear the brunt of job cuts, the union has said.

The organisation is best known for producing public information films - such as fire safety cartoon Charley Says or the Green Cross Code ads - but it also appoints advertising agencies and handles media buying on behalf of most government departments.

The bulk of the government's advertising spend - which last year topped ?500m - was coordinated by the COI.

But it also handles regional government news announcements from offices in Birmingham, Bristol, Cambridge, Cardiff, Edinburgh, Leeds, London, Manchester, Newcastle, Nottingham and Plymouth.

'Cost effective'

The Cabinet Office, which is committed to cutting the government's marketing bill by up to 50%, said last May that the COI would remain an important body because of the discounts a large central organisation could get on advertising campaigns.

But ministers appear to have had a change of heart following a review by Matt Tee, former permanent secretary for government communications, which recommended replacing it with a new communications centre.

Mr Tee also called for a 15% cut in the government's total communications staff of 6,848 employees.

"This government has slashed unnecessary spending on communications," said Cabinet Office minister Francis Maude.

"These important and significant changes to government communications structures are designed to reflect this and to save more money by cutting bureaucracy and reducing duplication.

"This does not mean the end of vital and cost-effective marketing campaigns, such as those campaigns that save people's lives.

"However, it does mean that communications spending in the future will never again get out of hand and instead will be more transparent, better co-ordinated and less bureaucratic."

Important campaigns on health or recruitment to the armed forces would continue, he added.

But Prospect said COI staff were "shocked and devastated" by the decision.

'More expensive'

General secretary Paul Noon said the news had come "completely out of the blue".

"Across government, ministers are centralising finance, HR and procurement in order to save money and cut duplication," he added.

"At COI, a shared service that has worked well and is respected by the industry in which it operates is about to be chopped into little pieces. It makes no sense at all."

Last year COI made 270 staff redundant in a major restructuring exercise, work which Prospect said now appeared to have been "a complete waste of time".

Mr Noon added: "Far from saving money, the cuts to COI will leave most government communications in the hands of media agencies who are certain to be more expensive than in-house professionals."

The government claims it has cut spending on advertising and marketing by 68% to ?168m in the past year, with departments reducing the number of in-house communications staff by a quarter and their budgets by half.

View the original article here

Government sticks to pension plan

20 June 2011 Last updated at 21:28 GMT Mr Duncan Smith opens the debate in the Commons on the Pensions Bill

The government will press ahead with plans to raise the state pension age for women but ministers have promised to look at "transitional" arrangements.

The coalition wants to raise the pension age for women from 60 to 65 by 2018 as a prelude to both female and male pension ages rising to 66 in 2020.

Critics say 330,000 women face working up to two years longer before retiring as a result of the proposals.

The coalition won a Commons vote on the plans by a majority of 70.

MPs voted to give a second reading to the Pensions Bill by 302 votes to 232.

During a Commons debate on the proposals, Work and Pensions Secretary Iain Duncan Smith insisted the coalition would not waver from its commitment to equalise the state pension age in 2018.

He told MPs: "Responsible government is not always easy government. It involves commitment, tough decisions and a willingness to stay the course.

But he said he was "willing to work to get this transition right" amid concerns over the "relatively small number of women" set to be disadvantaged.

'Tough decisions' Delaying the move to 66 until 2022 would cost the taxpayer ?10bn, which would be an "unfair financial burden borne disproportionately by the next generation", he added.

Last year, Chancellor George Osborne announced plans to accelerate the rate at which women's pension age would rise to equal that of men, currently 65.

The previous Labour government had agreed to achieve equalisation by April 2020, but the coalition's plans will see it achieved by November 2018.

Ministers will then use this extra time to raise the pension age to 66 for everyone.

The critics say many women affected by the proposals will have to wait between 18 months and two years longer than expected before they get their state pensions. They also say the changes are unfair as some women are being given as little as five years' notice of the changes.

More than 170 MPs have signed a Commons motion calling for a rethink over the plans, including both Conservative and Liberal Democrat backbenchers.

Lorely Burt, chair of the Lib Dem parliamentary party, said those affected would not have time to plan their retirement and many would be "financially a great deal worse off".

'Careers interrupted'

For Labour, shadow work and pensions secretary Liam Byrne said the government's plans had thrown the retirement plans of thousands of women into chaos.

Continue reading the main story Norman Smith Chief political correspondent, BBC Radio 4

The government finds itself in a bind over giving in to pressure to slow down the changes in pension age for women.

The problem is they've had to perform so many U-turns recently - health, sentencing, forests, etc - it is becoming a defining character of the coalition.

There must also be a concern that to backtrack over women's pensions would also be seen as a sign of weakness at a time when ministers are seeking to square up to the unions over public sector pensions.

And yet politically there is little sense in finding yourself lined up against well regarded age charities and further exacerbating tensions within the coalition - for a problem that only involves a comparatively small number of women.

It may be too that with the possible threat of legal action ministers have no option but to pause and re-think.

Certainly the government's critics are confident that whatever the government is saying now - it will eventually have to apply the handbrake.

"Women in their late 50s will have earned less over their lifetime, they have lower state pensions and private savings than men, many of them are unable to join a workplace pension and have interrupted careers to look after their family, many will have stood down from jobs on the understanding they would get that state pension early.

"What on earth are these women supposed to do with the measures set out in this Bill?"

James Gray was among Tory MPs to urge the coalition to think again.

"Going around the corridors and tea rooms in Westminster talking to Tories, Lib Dems and of course Labour MPs, they are saying this is an injustice being done to a small number of people," he said.

Meanwhile, Ros Altmann, director general of over-50s organisation Saga and a former government adviser on pensions, said ministers could face a costly legal challenge if they did not make changes.

"The current plans are unfair and may, indeed, be illegal in public law terms, since they clearly do not give women adequate notice of the large changes in pension age that they face."

Ahead of the debate, Prime Minister David Cameron appeared to get his own policy on pensions wrong in an interview with BBC Radio 2 - suggesting the retirement age will move to 66 in 2018.

The prime minister's official spokesman said Mr Cameron was merely saying the process towards 66 for men and women begins in 2018 but will be complete by 2020.

The Commons debate comes as union leaders are threatening industrial action over the government's proposals for public sector employees to work longer and pay more for less generous entitlements in retirement.

View the original article here

Government pension policy queried

26 May 2011 Last updated at 13:06 GMT Lord Hutton recently suggested further big changes to public sector pension schemes A committee of MPs has criticised the government's formulation of public sector pension policy.

The public accounts committee says a key feature of changes announced three years ago has yet to start.

Known as "cost-sharing and capping", it has been delayed with no firm implementation date.

The MPs say this undermines government claims that the cost of pensions for civil servants, NHS staff and teachers will be cut substantially.

'On hold'

The Treasury told the MPs that changes brought in during 2007-08 would limit the cost of these three big pension schemes over the next 50 years to 1% of the UK's GDP.

That would lead to a saving of ?67bn over that time, which the committee said would be a significant achievement.

However, about 60% of that predicted saving was due to come from cost-sharing and capping.

The policy would involve putting a ceiling on any further increase in pension costs to employers, which would lead to a big increase in staff contributions, or a cut in their benefits.

Margaret Hodge, chair of the Committee of Public Accounts, said: "The Treasury expects the majority of savings to come from cost sharing and capping, a reform designed to ensure that employees bear a greater share of future costs."

"However, implementation has been deferred because of the Treasury's discount rate review, and remains on hold while the government consults on the recommendations put forward by the Hutton Commission," she added.

Changes achieved

Two of the three main changes agreed three years ago have been brought in.

These were raising the normal retirement age for new joiners from 60 to 65, and increasing employee contributions for teachers and NHS staff.

More money will be saved by the more recent decision in 2010 to change the index for inflation-proofing in the pension schemes from RPI to slower-growing CPI.

Further big changes, such as switching most of the public service pension schemes from a final-salary basis to a career-average one, and raising staff contributions, have recently been recommended by Lord Hutton's public service pension commission.

Unaffordable?

Teachers' trade unions seized on another aspect of the MPs' report.

The committee said that Treasury officials had failed to explain exactly how they had decided what level of public pension spending was affordable or unaffordable.

"Officials appeared to define affordability on the basis of public perception rather than judgement on the cost in relation to either GDP or total public spending," the MPs' report said.

Christine Blower, general secretary of the National Union of Teachers, said: "The committee is right to criticise the government for proposing further changes without even having considered what is affordable."

"This is a policy based on nothing short of false assumption and spin," she added.

Chris Keates, general secretary of the NASUWT, another teachers' union, said: "This damming report highlights the Treasury's failure to have even the most basic figures in place on which to base its proposals for worsening public service pensions."

Russell Hobby, general secretary of the NAHT, said the government had been disingenuous in claiming that pension costs were unaffordable.

"To move to make changes to the pension scheme for teachers when the case for change is unproven is reckless in the extreme," he said.

View the original article here

Government wine cellar avoids axe

13 May 2011 Last updated at 13:50 GMT Henry Bellingham MP: Government cellar self-financing "a big saving"

The government has ruled out shutting down its wine cellar to cut costs.

The cellar - containing about ?2m worth of wine and spirits - is the most "cost effective" way to supply wine for state banquets and other events, it says.

But the purchase of wines will become "self-financing" - paid for by selling off some of the most expensive bottles.

The cost has been criticised by MPs from different parties - since the general election about ?45,000 has been spent on new wine.

The future of the wine cellar, which is run by the Foreign Office, has been under review for almost 11 months to ensure it is "appropriate to the contemporary environment" - by providing value for money.

The review concluded that keeping the wine cellar was the cheapest way to supply wine for hospitality events, but that "substantial reform" was needed.

'Much more costly'

Foreign Office Minister Henry Bellingham told BBC Radio 4's World at One programme: "Don't forget this is a resource that's used by government for government hospitality, for business hospitality, for visiting heads of state.

"If we sold the cellar, we'd have to go out there and buy wine and ultimately that would be much, much more costly.

"We are going to be selling some of the fine, valuable wines. We're going to be getting about ?50,000 in a year and the purchase of wine is going to be completely self-financing."

Continue reading the main story

Obviously, when the French president comes over we've got to serve him wine at his dinner, so a limited collection is probably the right thing”

End Quote Tom Watson Labour MP The government also says there will be an annual statement on the use of the wine cellar - including what has been bought, what has been drunk and its value for money.

Robin Alexander, the government's head of hospitality, told the BBC that the "vast majority" of his work was taken up with ministerial hospitality, rather than state banquets, which used the "reliable" stock rather than "top wines".

He said a bottle of Chateau Latour 1961 - which has a market value of between ?4,000 and ?10,000, depending on where it is being sold - had been bought for "51 shillings and 5p". The stock also includes a 1931 Quinto Do Noval, which he described as "probably one of the great ports of the 20th Century".

The Hospitality Advisory Committee for the Purchase of Wine was abolished last year - one of 192 quangos to be axed by the government. But its members have agreed to provide "expertise... on an ad hoc basis", the government says.

Labour's Tom Watson has previously used a series of parliamentary questions and Freedom of Information requests to discover that the cellar featured high-profile wines from the likes of Chateau Latour, Chateau Lafite, Chateau Margaux and Chateau Mouton Rothschild.

He told the BBC he believed the government had been prompted into action by a recent Information Commissioner's ruling that it should list the value of every bottle in the wine cellar.

"I didn't know there was a bottle of Latour 61 that was worth ?10,000. I certainly don't know which minister would dare to drink it. It is simply unacceptable in a time of cuts that we can have these very expensive bottles of wine sitting around in government departments," he said.

"Obviously, when the French president comes over we've got to serve him wine at his dinner, so a limited collection is probably the right thing."

In opposition, Lib Dem MP Don Foster suggested the previous government was "living way beyond their means" after it was revealed the cellar contained 39,500 bottles of wine, spirits and liqueurs worth around ?792,000.

View the original article here