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GMB missing millions would pay pensions bill

A local government union has attacked cash-strapped councils for failing to collect more than £800m in revenue from local residents which it claims could be used to plug the pension gap.

The GMB drew the figures from recent data published by the Office of the Deputy Prime Minister showing that a total of £835,729,960 went uncollected in council tax and council rents in 2003/2004.

Birmingham tops the list with £26.5m in uncollected revenue, followed by £24m in the London borough of Hackney, which has the worst record for council tax collection in the country.

The GMB is calling for a change in the law to force landlords to take responsibility for making tenants pay their council tax and stop local authorities losing out.

Justin Bowden, the GMB's senior public services organiser, said the pensions funding gap could be solved if councils collected the revenue owed in full, rather than forcing council workers to pay the price.

"The local authority pension scheme needs £200m per annum to enable it to pay pensions to GMB members without cutting benefits or raising the retirement age," he said. "If councils could collect the monies that they are owed they could easily fix the pension gap problem."

However, a spokesman for the Local Government Association dismissed the union's link between pension schemes and council tax collection.

"Council tax collection is good and continuing to get better," he said. "GMB's figures represent an incorrect snapshot. Much more of this money will be collected next year. Evaders will continue to be pursued, and councils will go on to collect up 98% minimum of tax.

Pensions talks are back on the table following the government's decision to revoke changes that had been due to come into force last April, and unions are keen to demonstrate other means of resolving the crisis facing local government pensions schemes.

John Prescott had planned to introduce changes which would increase the retirement age to 65, and end the 85-year rule which allows local government staff to retire once their age and years of service total 85.

Following a successful ballot for ongoing strike action, the government agreed to revoke the changes and bring discussions back to the local government table.

Local government employers have seen their contributions to staff pensions rise as a result of longer life expectancy and stock market fluctuations.

While local authorities claim the mounting bill requires a change in arrangements, unions have made clear they will resist any deterioration in their members' pensions with strike action if necessary.

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