Ministers act over unions' fears for pensions

Ministers are considering giving trade unions the right to include pension rights in collective bargaining, bringing them in line with pay and conditions negotiations.

Patricia Hewitt, the Secretary of State for Trade and Industry, has ordered a review after meetings last week with bosses at Amicus, the country's second-biggest union.

The two sides will meet again on Tuesday at the Trade Union Congress in Blackpool to discuss the issue, with both keen to avert a looming crisis for the pensions industry and the retirements of millions of people. Britain's entry into the euro and the prospect of war with Iraq will also be high on the conference agenda.

Roger Lyons, the general secretary of the MSF branch of Amicus, said the refusal of successive governments to restore the link between pensions and average earnings, coupled with employers' insistence on scrapping final-salary pension schemes, could put unbearable pressure on working people in old age.

"One of the richest economies in the world is transforming its future senior citizens from comfortable old age to poverty," he said.

The pensions crisis will headline debate in Blackpool. John Monks, the TUC general secretary, told The Independent on Sunday yesterday that Congress would be demanding that all employers give assurances that they will maintain final-salary pension schemes. The TUC will also call on the Government to make it compulsory for employers to contribute to pensions schemes for their staff.

He said: "One of the main issues at the Congress is the flight from final-salary pension schemes by too much of corporate Britain. I think it is absolutely disgraceful, and if these companies gave assurances that they would maintain final-salary schemes when they took contribution holidays in the 1990s stock-market boom, they should make good their undertakings and promises now."

The issue will be debated on Wednesday – a day after the Prime Minister's address. In his speech Tony Blair is expected to focus on Iraq. Mr Monks made it clear, however, that the TUC would take some convincing that there was any case for the US and the UK to go it alone without UN backing.

"It is possible that the Prime Minister will try to rally support for it," Mr Monks said. "But that will be difficult."

Last year's Congress was overshadowed by the 11 September attacks. But had Mr Blair been able to deliver his speech, it would have been one of the clearest indications yet of his intention to take Britain into the euro.

Delegates are expecting similar warmth to the single currency from the Prime Ministerial this week, despite some union dissent.

Whitehall sources said it was likely the Prime Minister would "speak about the euro and the need for Britain to compete in all sectors, including manufacturing".

But Mr Blair is unlikely to go any further than confirming there will be an assessment next summer of the five tests for entry and restating the Government's support in principle for single-currency membership.

Mr Monks said: "There will always be reasons why it is not the right time but if we don't grasp this matter our potential to play a part in the European Union could be lost. I am saying go for it as soon as is practicable."

The TUC kicks off the annual season of political conferences, again overshadowed by events on the international stage. Last year's Congress was all but abandoned after the September 11 terror attacks. This year, the threat of war against Iraq will loom large.

Where are they going?

To Blackpool, home of transvestite revue bars and bad taste tat. The down-to-earth lads and lasses of the Trade Union Congress should feel right at home.

Conference facts

About 700 delegates and up to 80 exhibitors will attend a meeting where 94 motions and 54 amendments will be debated.

On the platform

Major speakers include Estelle Morris, the Secretary of State for Education and Skills, Julie Mellor, who chairs the Equal Opportunities Commission, Bert Massie, who chairs the Disability Rights Commission, and Emilio Gabaglio, the president of the European TUC. Charles Kennedy, the Liberal Democrat leader, will be the first non-Labour leader to address the TUC.

In the fringes

Look out for Derek Simpson, the newly elected general secretary of the AEEU section of Amicus. He's tipped to end the Amicus love-in with the Government. A sadder figure may be Sir Ken Jackson, the man he defeated in a disputed leadership election.

Speech of the week

All eyes will be on Tony Blair when he takes the stage on Tuesday, fresh from talks with President Bush.

On the agenda

Aside from the inevitable attention on Iraq, delegates are keen to voice concerns about pensions, the rights and wrongs of euro membership and the future of public services. The TUC is expected to voice its strongest opposition yet to the use of private firms in the delivery of public services as well as to existing private finance initiative projects.