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Thank You - RobertT

20 Nov 2019, 21:21

Thank you Renrag40 for your detailed reply.

Thank You - RobertT

24 Nov 2019, 12:50

westham000 wrote:I would also like to thank Robert and Royal Mail Chat for providing this forum, although I have to keep signing in every two or three days which is becoming rather frustrating.

And while I am here ask a question on our new pension scheme if we ever get their.

13.6 percent contributions on Royal Mail behalf works out on my pensional pay at just under £70 a week free money, being a London Postie.

I also believe, and I hope Robert corrects me on this, the minimum contribution any company has to make is 5%. Bearing in mind this, does anyone on this site seriously believes Royal Mail under their new regime will honor their 13.6 contributions, and not lower it to the minimum allowed contributions allowed by this Tory Government which I believe is 5%.

I welcome your comments.

Only just replying to this as I've been on holiday.

RM currently pay a total of 15.6% into the DBCBS, 2% of which goes towards paying for death and IHR benefits.
The planned RM contribution rate for the CDC scheme is 13.6%.
Employees pay 6% with both schemes.

The current total minimum amount that has to go into a workplace pension is 8% of pensionable earnings, which is made up of:

3% - employer
4% - employee
1% - tax relief

Details here: https://www.pensionsadvisoryservice.org ... ave-to-pay

In practice some employers might not include all earnings, such as RM's use of the LED.

All the propaganda says RM will be introducing the CDC scheme when the legislation goes through, assuming it does! But 13.6% is a generous contribution rate and is obviously expensive for the company, at around £400 million per year.

Any decision to cut the percentage going into CDC would also cut the potential growth rates(in money terms) as well as the pay outs to us. Plus as renrag40 says, a drop in employer rates is effectively a drop in pay!

There's been quite a lot of work put in towards the introduction of CDC, such as a government consultation, the lobbying of MP's, being included in the Queens Speech, etc. None of which would have happened if CDC wasn't agreed during the 4 Pillars negotiations, as RM are the only company currently seriously planning on introducing it.
So for them to turn around and say sorry we don't want to do it anymore, is unlikely in my opinion.

In practice I suspect whether RM will be able to afford CDC in the long run may depend on them reducing the workforce to the numbers they want to, or else it will only last for perhaps just a few years?

I'm not particularly into politics, but it was the Tories that introduced auto-enrolment, which is a phased plan that started in 2012, to ensure that all workers have access to a pension scheme. Previously there was no compulsion for any company to offer a pension to their employees at all, let alone pay into it.
So for some people 3% from their employer is 3% more than they were getting before.

Thank You - RobertT

25 Nov 2019, 14:29

renrag40 wrote:Hi Westham, the employer contributions are 15.6% of which 13.6% goes into the cash balance fund along side your 6%. It is not “free money”....... it is part of your remuneration package..... always remember, you have earned it..... any reduction in the employer contributions would be a pay cut for the employee..... that is not an effective pay cut, it is an actual pay cut. To put into perspective, how would you feel if RM announced they were going to reduce your basic pay by £45 per week? This is the equivalent of reducing the employer contributions down to the legal minimum. Up in arms? We all should be because it would be little short of theft!


ALWAYS makes my Blood Boil when you hear any Employer going on about Pensions, and how much they are costing the Company! :mad While at the same time throwing ridiculous ammounts of money at the Top Excutives .... In Bonuses .... "Golden" Hellos & "Golden" Handshakes. The Business Community is totally devoid of any Moral Compass. :thumbdown Surely the least anyone should expect in Old Age is a Decent Pension? :cuppa

Thank You - RobertT

26 Nov 2019, 21:43

Thank you Robert for your in-depth explanation on our pension.

So the minimum contributions into a works pension scheme is 8%.

Royal Mail are paying 15.6% which is 7.6% more then they need to pay, nearly twice what they are required to pay. Robert worked it out at 4 hundred million a year. Hope I’m wrong, I think Rico will either turn us into a gig company, and do away with pensions, holidays, sick pay etc, or substantially reduce their pension contributions, which has already been pointed out would be a substantial pay cut.

This really is a defining moment for us, and all the more reason to support our union the CWU.

Thank You - RobertT

27 Nov 2019, 05:52

westham000 wrote:Thank you Robert for your in-depth explanation on our pension.

So the minimum contributions into a works pension scheme is 8%.

Royal Mail are paying 15.6% which is 7.6% more then they need to pay, nearly twice what they are required to pay. Robert worked it out at 4 hundred million a year.

8% is the total minimum percentage that has to go in, of which only 3% has to be off the employer.
Current total contributions into the DBCBS is 21.6%, of which RM pay 15.6%. So RM are actually paying 12.6% more than they have to by law.
Although 2% of their contribution goes towards IHR and death in service payments.

Hope I’m wrong, I think Rico will either turn us into a gig company, and do away with pensions, holidays, sick pay etc, or substantially reduce their pension contributions, which has already been pointed out would be a substantial pay cut.

That would be a worst case scenario, and if Rico gets everything he wants then it could become a reality.

This really is a defining moment for us, and all the more reason to support our union the CWU.

Agreed! :thumbup

Thank You - RobertT

27 Nov 2019, 18:10

I think some of us lose sight of the fact that Royal Mail "Used" to be a State Owned Company. Most other State Owned Organisations, like the Army & The Police, also have Good Pension Schemes. I'm sure this is why Royal Mail's scheme was so good years ago. :hmmmm

However things move on and Vince Cable decided to sell us off to his Mates in the City. So far I think we've been lucky that we haven't lost more from our Pensions (although they've had a couple of changes) :thumbdown

I share your fears that it won't be too long before Rico realises he could save some money by slashing our Pensions. :cuppa

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