On Monday 12th September, David Cameron became the first British Prime Minister to travel to Russia to meet with President Dmitry Medvedev and Prime Minister Vladimir Putin since 2006. Relations between the two countries deteriorated following the murder in London of Alexander Litvinenko, an ex-member of the Committee for State Security (KGB) in the former Soviet Union, and the subsequent refusal of the Russian authorities to extradite Andrei Lugovoi, the primary suspect in the crime. Cameron said that it was possible to establish improved political and business relations despite the continuing disagreement over the affair and announced that a series of deals reported to be worth up to £215million had been agreed upon during his visit.
The government announced plans to reform the political system in Britain by condensing the number of constituencies, and therefore the number of MPs in the House of Commons, from 650 down to 600. It has been advocated by the Conservative Party that fewer MPs will reduce the cost of politics to the taxpayer and will further help the government to meet targets on spending cuts, while they claim that the system would be fairer because each constituency would have the same number of registered voters. However, both Labour and the Liberal Democrats have expressed concerns over the reform, with Labour arguing that the new constituent boundaries may unfairly benefit the current government and the Democrats are worried about the break-up of constituencies where they have worked hard to make gains. If the Bill is successfully passed through Parliament, the reforms will be implemented in time for the next general election in 2015.
Tensions between public sector workers and the government intensified as the Trades Union Congress (TUC), a national federation of trade unions, threatened strike action in response to the Pensions Bill currently being examined by the government. The Bill, which will be put forward for the report stage and third reading in the House of Commons on 18th October, intends to raise the pension contributions from public sector workers by 3.2% in order to cover the increasing costs of pensions. Brendan Barber, the leader of the TUC, stated that industrial action was scheduled to take place on 30th November and that the ‘biggest trade union mobilisation for a generation’ would go ahead if demands for the proposals to be reviewed were not met by the government.
However, his words were derided by Chancellor George Osborne as irresponsible at a time when negotiations over public pensions were ongoing, while he also felt that the planned action would only damage job opportunities and prosperity during the current economic climate. He added that the anticipated changes would make the pension scheme fairer for taxpayers, while public pensions would still remain strong in comparison to the private sector despite the contributions increase. Labour leader Ed Miliband shared a similar view during his speech at the TUC on Tuesday 13th September and was heckled by the crowd when he criticised the strikes on 30th June and claimed that the planned industrial action for later in the year was a mistake while talks were still taking place.
The Bill also contains measures for bringing forward the retirement age increase to 66, which could now be implemented as early as 2020, with a further increase to 67 expected by 2026. In an interview, Danny Alexander, the Chief Secretary to the Treasury, said that the age increase was required due to an improvement in life expectancy over the previous century, while the age for collecting pensions remained unchanged throughout the same period. Consequently, as more people are living for longer, there is additional pressure on the financial resources available for pensions and, with the government attempting to reduce the record deficit levels, individuals will now have to work longer and contribute more. Alexander also hinted at the possibility of introducing an automatic mechanism so that as life expectancy increased, the pension age would increase accordingly.