Speaking yesterday in the House of Commons, chief secretary to the Treasury Danny Alexander described an increase to the pensions 'cost ceilings', where employees in the public sector would receive pensions based on one 60th the value of the average salary, which he added is 8% more than previous proposals.
He said: "This generous offer should be more than sufficient to allow agreement to be reached with unions."
And although in prime ministers questions yesterday, the prime minister David Cameron said the proposals would give public sector staff higer retirement savings than most private sector employees, Unison the largest public sector trade union in the UK still plns to ballot its members today over industrial action on 30 November.
Alexander said any changed would not affect any staff within 10 years of retirement and suggested a settlement could pave the way for an agreement not to reform pensions further in the public sector, for 25 years.
The proposals were put forward at a meeting of the TUC's Public Services Liaison Group (PSLG) at Congress House in London yesterday morning. In a statement the PSLG said: "At the meeting earlier today Danny Alexander and Francis Maude outlined a number of new proposals to the TUC negotiating team, including an improvement in the proposed accrual rates within the major public service schemes compared to their previous position, and new proposed transitional protections for those closest to retirement. They also indicated a long-term commitment to any agreed reforms not being reopened within the next 25 years.
"The PSLG welcomed this movement in the Government's position which has come as a direct result of the strength of feeling and determination shown by public sector workers and the groundswell of support for the TUC's day of action at the end of this month.
"These proposals, and their detailed implications for the pensions offer within each scheme, will now need to be considered in detail within the sector specific negotiations, alongside all the other issues including proposed contribution increases, increases in the pension age, and the impact of the indexation change from RPI to CPI on which the government's position remains unchanged.
"All the unions have indicated throughout this process their determination to reach a negotiated settlement on all these issues. That remains the position and unions will engage intensively in the coming weeks. But unless and until further real progress is made and acceptable offers are made within those negotiations, unions remain firmly committed to continuing their preparations for the planned day of action on 30 November.
"A further meeting of the PSLG will be held in November to consider reports on any progress made within the sector talks."
Unite assistant general secretary, Gail Cartmail said: "If it wasn't for the strength of feeling amongst public sector workers, the Government would have never made this change to their original and dreadful proposals.
"This is welcome, but it is a first step. Now the negotiations with the government can begin in earnest, but there is no time to waste. There is still along way to go and Unite remains committed to the Day of Action on 30 November.
"It is absolutely vital that we continue to campaign and keep up the fantastic work union representatives and members are doing across the public sector to defend public sector pensions."
Joanne Segars, chief executive of the National Association of Pension Funds (NAPF), added: "The Government's announcement is an important milestone in the negotiations on public sector pensions reform. Such reform is necessary to guarantee their long-term sustainability and to ensure public sector workers can continue to receive good quality pensions.
"Ultimately, we need to avoid a race to the bottom. All workers, whether in the public or private sector, should have the opportunity to retire with a good pension."
