Royal Mail pension deficit hits £4bn

Post by **TrueBlueTerrier** » 24 Oct 2008, 15:30

http://www.ipe.com/news/Royal_Mail_pens ... _29520.php

UK – Royal Mail has confirmed its pension deficit in accounting terms has increased by more than £1bn (€1.26bn) between March and September 2008, to reach £4.04bn.

Figures from the company's trading update for the six months ending 28 September 2008 showed despite controversial pension reforms implemented earlier this year, (See earlier IPE article: Unions urge rejection of Royal Mail deal), "heavy falls in the stock market" increased the deficit from £2.92bn to over £4bn.

In addition, the statement admitted the actuarial deficit – scheduled for its next valuation at 31 March 2009 – is of "particular concern", as Royal Mail said "it is likely to have increased substantially from the previous level of £3.4bn in March 2006".

The figures also revealed regular pension contributions to the scheme by the group had increased by 4.1%, or £11m, year-on-year as a result of increased pay costs, although the rate of employer contributions to the Royal Mail Pension Plan remained at 20%.

Although the actuarial deficit is still unclear, Royal Mail confirmed it contributed an additional £284m to the pension scheme in 2007/08 and that it will continue to pay an "an average of over £260m per annum for the 15 years from 31 March 2008", in an effort to clear the billion pound deficit.

The Communication Workers' Union (CWU) threatened Royal Mail with a series of strike actions in June if it refused to back down on the changes to the £23bn defined benefit (DB) pension scheme, which include plans to raise the normal retirement age to 65 and to place new employees in a defined contribution (DC) scheme. (See earlier IPE article: Royal Mail given "last chance" to avoid strike threat) http://www.ipe.com/news/Royal_Mail_give ... _28259.php

k979aaa · Post by **k979aaa** » 24 Oct 2008, 20:33

It's all gone so quiet at the moment!. But just think if the govenment did not take the 3 billion pound's out of royalmail between 1991 to 2001 and that royalmail did not have a pension hoilday at the same time!. THATS WHAT IS CALLED HAVEING YOUR CAKE AND EATING IT!. FAT CAT BAST*RD POLITIANS :mfo AND THEIR MINION'S :cfo & :lfo

Night Tonic · Post by **Night Tonic** » 26 Oct 2008, 17:41

Anything above that figure would have all gone in taxes anyway, hence the pension break. 1991-2001 were the years when Royal Mail frittered away billions buying up companies and property that made no money at all.

DGP1 · Post by **DGP1** » 26 Oct 2008, 17:53

All money went to the government anyway so what would have been the problem with putting it into the pension fund.

Night Tonic · Post by **Night Tonic** » 26 Oct 2008, 18:47

All those in private sector pensions would then have expected the government to bail out theirs. Pension funds don't work like that anyway.

DGP1 · Post by **DGP1** » 26 Oct 2008, 19:00

The difference between us and other private companies is everything we make goes to the government either in profits or in taxes so I'd rather have paid 25% tax (or whatever it is) and have the other 75% in the pension fund.

It's all lies and BS just for the benefit of managers bonuses.

k979aaa · Post by **k979aaa** » 26 Oct 2008, 19:08

disgruntledpostie1 wrote:The difference between us and other private companies is everything we make goes to the government either in profits or in taxes so I'd rather have paid 25% tax (or whatever it is) and have the other 75% in the pension fund.

It's all lies and BS just for the benefit of managers bonuses.

yep and he :cfo has had 8.3 million pound's of it and god knows how much pension he will receive of the backs of hard working posties!. :cfo is nothing but a parasite in my eyes lives of the hard work of others!.