Together Gibraltar has issued a statement on their position and suggested solutions to the current "issue of pensions and Community Care".

A statement from Together Gibraltar follows below:

It’s been many months since we started doing a deep dive into the issue of pensions and Community Care. The Committee, who asked us for an official position on the recent developments (changes to the community officer scheme) a few weeks ago, have been waiting patiently for our response, aware as they are that this issue is one of the greatest political minefields of our time. In fact, this is perhaps the most challenging of all the systemic failures that the next Government will inherit. At TG we want to make sure that our position is realistic and responsible, so that, if entrusted to do so by the people of Gibraltar, we may bring forward solutions instead of kicking the can down the road - like both GSD and GSLP administrations have done in the past. 

In order to have a fair position, it is important that we offer the reader some context as to how we got where we are today. 

The official narrative is that the Community Care Trust (which was set up some 32 years ago) is a private charitable trust with no links to the Government of Gibraltar, however, the trust pays moneys aimed at complementing Gibraltar’s measly statutory pensions, a reflection that these pensions are wholly inadequate for the costs of living in Gibraltar. Government also happens to provide the vast majority of the funds distributed by the CC Trust. 

The Trust pays a sum of money to resident persons of pensionable age in Gibraltar to assist them in meeting household costs; namely, the Household Cost Allowance (HCA). Moreover, men aged over 60 and under 65 can apply for employment as a Community Officer (CO) and will be required to provide certain social and community services. 

The CO scheme, on the other hand, is paid to males aged between 60 and 65 who are not entitled to the HCA and who do “community work”. GCC introduced this payment to provide some income until such time as the Community Officers became eligible for the old age pension at the age of 65, a pension based on the social insurance contributions they had paid. 

James Levy, chairman of the GCC Trust, describes the current problem as follows: “The conditions of the original system as conceived a number of years ago required that applicants for the COA should be aged between 60 and 65, registered as unemployed (having exhausted their 13-week unemployment benefit), and have no pension or other income. Successful applicants could then be required to work up to 80 (eighty) hours a month. 

At a later stage, GCC then relaxed the conditions for Community Officers such that the only criteria then was that if they were in employment, they should not earn more than £15,000 if they were to get the full COA and, that, if they earned more than £15k but less than £21,800, they would be entitled to a reduced COA. The means test excluded occupational pensions from the assessment, with the effect that very few applicants ever failed it. That, in turn, meant that many individuals with substantial income would rearrange that income to keep it below £15,000 in order to receive the full COA. The number of registered Community Officers therefore grew, with the consequence that the requirement for up to 80 hours a month of community duties became more like 8 hours a month as there were simply not enough duties to allocate for the numbers involved.” 

Thus, we encounter the first of many problems of the Pension/GCC minefield: Community Care is (in theory) a private entity that makes decisions unilaterally and has no political accountability, yet the trust operates mostly with public funds and their decisions have (in practice) an impact on public policy (namely changes to pension policy). Can anyone imagine what would happen in Gibraltar if the CCT were to decide to reduce household cost allowance payments unilaterally? Does anyone believe that people would protest anywhere other than No.6 Convent Place? 

This impacts both recipients of Community Care payments and political agents (such as Together Gibraltar) fighting for better pensions in Gibraltar, who are invariably accused of “playing into the hands of the enemy” when highlighting the aforementioned contradictions. This is because Community Care has come under fire on several occasions by organised groups of Spanish pensioners and both the Spanish and the UK Governments. The reasons why were resumed as follows by ex Chief Secretary Ernest Montado in 2002, in his Government of Gibraltar Memorandum on Pensions, the Community Care Trusts and Household cost Allowance: 

“In February 1996, the British Government began to urge the Gibraltar Government to reform HCA because it considered that the scheme might breach EU rules prohibiting discrimination in social security benefits, given that the HCA was not being paid to Spanish pensioners who were not resident in Gibraltar. The British Government view was that HCA may be a social security (and not a social assistance) measure because it is based on age and not on need. 

The British Government has often offered "technical assistance" to help in the reform of HCA, insisting that HCA must be made means-tested (rather than universal) and that it has to be means-tested at a threshold which would result in a significant number of current and future recipients having payments drastically reduced or cut off altogether.” 

Just to clarify, the issues raised by the British Government at the time were that the CC scheme seemed to be, from an outsider’s perspective, a vehicle aimed at increasing pensions only for locals, while discriminating all non-resident workers (mostly Spanish, but not only). 

These recommendations, which are yet to be addressed, respond to the aforementioned duality of the CCT - an entity whose actions amount to pension policy and who operates with public funds, whose relationship with Government Mr. Montado describes as follows: “(The Gibraltar Government) has no powers to interfere with the workings of Community Care Trust. Even were the Gibraltar Government minded to do so, it lacks the power to modify the Community Care Trust or to direct the Trustees thereof to modify these payment of allowances to comply with HMG's requirements, or at all.” 

Enter the Community Care action Group. This group has had the courage to protest the unexpected, unilateral changes in the Community Officers scheme, and highlight the aforementioned contradictions. It claims that payments made to Community Officers by the Charity are ‘a pension’, and they justify these claims by the fact that they are covered by public funds and that future recipients relied on a scheme that had been operating in its prior form for close to 30 years. As expected, the group have been branded something akin to traitors by the GSLP’s propaganda machine. 

Before TG can put forward an official position on this matter, there are two important issues that must be addressed. 

The first is this completely unreasonable veil of secrecy and pretence that surrounds the issue of Community care. 

How is it tolerable that, in the year 2021, with a government that purports to want Government action to be transparent and accountable, we have to continue to tiptoe around this issue? Why should people be coerced and gagged when raising what is, in practice, clearly an issue of public policy? Why do we have to use euphemisms to refer to this area of governance, and why do we need to implement see seemingly discriminatory practices in the first place? How can there be progress on any of our systemic problems if by raising them people are accused of “playing into the hands of the enemy”? How can a board that includes senior partners of law firms, make independent decisions on matters of policy? Where is the legitimacy for this body to unilaterally adjudicate public funds? 

The second issue is that no clear position can be taken without a better understanding of the health of our public finances. 

It has now become apparent that the Government is undergoing substantial spending cuts and trying to raise revenue by introducing stealth taxes. Considering this is clearly a Government with a penchant for big spending, the state of our public purse must be pretty dire. This is one of the most challenging issues faced by opposition parties in Gibraltar, as we respond to Government economic policy with a limited understanding of the real picture of our spending and borrowing. Of course, TG could play the game the way of traditional opposition parties do in Gibraltar and claim we will reinstate all payments and then some, but we will leave that to “traditional” parties such as the GSD. Together Gibraltar believes that Gibraltar deserves a better opposition that puts forward a message of honesty and responsibility, and although it may be not be the most popular position, prefers to be cautious at this stage. 

From the outset, TG would like to make clear that it agrees with the equalisation of the pensionable age between men and women. It would also like to make clear that it profoundly dislikes the current mess of a system created by the GSLP and the GSD, and would like to see profound reforms to the pension system. This unified system should provide a living allowance to ALL workers regardless of residence or nationality, and should be under the control of elected officials - which in turn would be accountable to our parliament and to the people of Gibraltar. The party is aware that this would be a costly endeavour which would take several years to implement, and believes that in the meantime all cases should be looked at in a case-by-case basis. Government should issue recommendations to the CC Trust as to what individuals will undergo hardship as a consequence of this unilateral policy change. If the CC Trust does not consider these recommendations, then Government should return the favour by pulling all public funding for the Trust. 

This policy should be implemented for at least a period of 5 years in order to cover the majority of workers who have legitimately planned their retirement with the expectation of receiving the COA, and need it to guarantee decent living conditions.