Submission to pension consultation:

[anon]

Submission to pension consultation:

Dear Sir/Madam,

My submission first argues that as the pension fund is protected by The Pension Protection Fund (PPF) of April 2005 the proposed action is excessive.

According to their web site:

"Protecting People's Pensions



The Pension Protection Fund (PPF) was set up in April 2005 to protect you if your employer goes bust and its pension scheme can no longer afford to pay you your promised pension.

If you are a member of an eligible scheme, and you have reached the scheme's normal pension age, we will pay you 100 per cent compensation for what you should have received at the time your employer went bust. We will also pay 100 per cent compensation to those who have retired on legitimate ill-health grounds, regardless of age, and to those receiving a pension in relation to someone who has died.

If you have retired but have not yet reached the normal pension age of your scheme, we will pay you up to 90 per cent compensation. The same applies if you are yet to start receiving pension payments. The total level of compensation is subject to an overall cap which is recalculated each year. Between April 2007 and March 2008, the cap at the age of 65 is set at £29,928.56. This equates to £26,935.70 for those receiving compensation at the 90 per cent level."

Source: http://www.pensionprotectionfund.org.uk ... nsions.htm

In reality the fund is protected by that above act and therefore the suggested remedy to reduce Royal Mail's liability is not proven.

Furthermore consideration should be given to having a flexible contribution rate for existing and future employees and linking the contribution rates of Royal Mail to profit levels before contribution.

This contribution rate for both employer and employee , as stated, would be flexible and increase or contract by no more then say 3%..

Therefore a link is established with the health of the company, for both the employee and employer, and the fund receives increased contributions as profits improve and less in periods of contraction, within defined limits of say plus/minus 3%.

The current sumisson by Royal Mail only allows for reduction of Royal Mail's contribution and its inflexibility does not factor in future improvements in the health of company profits.

Improvements in the future financial postiton of the company in a flexible scheme would see employees benefiting with an increased pension.

I cannot agree with the proposal to limit future increases in pension to a maximum of 5%.

There should also be no reduction of benefits for those retiring at 60, regardless of which scheme is adopted, for employees in scheme prior to implementation of any proposals.
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Mypension@royalmail.com