Fears that council housing staff who transfer to arm's-length management organisations would lose vital pension rights have been quashed by swift government action following a story in Housing Today.
In a measure of the political capital riding on ALMOs, the DTLR has moved to change the terms of the national pension scheme for council staff, after being alerted to the problem (Housing Today, 14 February).

Westminster council, one of the arm's-length pilots, hailed the decision as "the real show-stopper".

From 6 March, arm's-length companies will be admitted to the pension scheme. Without the concession, staff who joined the bodies could have lost benefits if they later moved elsewhere in local government.

The pilots had warned the DTLR that the issue must be addressed urgently. If no decision had been taken by 9 March, the new organisations would not have counted as "admitted bodies" in the scheme, and staff could have lost out on pension rights.

Westminster's arm's-length organisation will be relatively small, with only 160 staff transferring. But housing operations director Nigel Brooke said the move would put minds at rest.

"In terms of a TUPE transfer, this is as soft a landing as you can get," he said.

But there was confusion over other staff arrangements for arm's-length organisations.

Westminster understood that the government had accepted the need to specify the new organisations in the Redundancy Management Order, which ensures that staff moving to other councils can take their length of service benefits with them. But the DTLR was unable to confirm this.

Government legal advice has so far suggested that no change is needed because arm's-length organisations are covered. But unions are pressing for more certainty because a test case could wreck the assumed agreement.

Peter Wilmot is to head up human resources at the Ashfield council ALMO from April. He said: "There is a debate on continuity of employment. We don't want to be too restricted by conditions because we want the freedom to set our own terms somewhere down the line.

"We can't claim independence from the council if we are still tied to local government terms."

Local Government Association programme manager Gwyneth Taylor said the government must be given time to sort out the problems.

"Different advice has been given by different agencies and that will have to be resolved. But that is why we have pilots and a working group. It would be a miracle if there were no problems," she said.

Unison said it would continue to press the government on the issue.

Source

Housing Today