Unions in further and higher education and across the civil service reacted with anger this week at the Government's announcement that the running of the Teachers' Superannuation Scheme is to be privatised despite overwhelming opposition.

Robin Squire, minister for education, said the Government had selected six companies to tender for a contract to administer the TSS, currently run by the Teachers Pensions Agency, an executive arm of the Department for Education and Employment. The Government first asked for bids in June.

Since then there has been unanimous opposition from the teaching unions with members in the scheme - there are 1.2 million members from new universities, colleges of further and higher education, sixth-form colleges and schools - and from civil service unions whose members work for the TPA. They have argued that no case has been made for savings or improved efficiency. They claim that out of 131 responses to the consultation process only three were in favour of privatisation and of those one was a possible contractor.

The unions are seeking a meeting with Gillian Shephard, the Secretary of State for Education and Employment, to put their objections - 20 unions are represented in the TSS group - and are advising their members to lobby their MPs urgently. Any change in the running of the scheme would have to be approved by both houses.

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Marion Bird, deputy head of pensions of the Association of Teachers and Lecturers, said: "At the moment the scheme is operated with very high standards and we cannot see that privatisation and saving costs can possibly maintain these. Our members are renowned for their quietness but on this issue they feel very strongly."

Both the Civil and Public Services Association and the National Union of Civil and Public Servants said the decision was terrible news for teachers. John Sheldon, NUCPS general secretary, said: "It ignores the agency's excellent performance over the past three years and mixes ignorance and political vindictiveness in equal measure."

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Mr Squire said in his announcement that a contract would be granted only if it was better value for money. Such a contract - which if granted would start in the latter part of 1996 - would not affect the size or safety of teachers' pensions. Under the scheme payments are made to the Exchequer which in return guarantees payments to retired teachers.

Members of the Universities Superannuation Scheme in the old universities will not be affected by any of the changes planned.