Pension Raid

[royals]

Looking at what Martin Walsh has posted it seems like we are going to have a CWU backed raid on our surplus. [

- "The EP agreement says we will get a share of the pension surplus when the Trustees are satisfied. There are two pension surpluses , the first is from the Care Scheme and the other. Is from the Cash balance which is smaller.

When we get a share it will go into the employee benefit scheme which will also generate 10% of any profit made by the company in future pay rises.

This surplus was at risk of going exclusively to EP. At the appropriate point the union and our democratic process including our conference with decide how we use it. There is a motion at this years conference asking the union to use the pension surplus to reduce from 67 to 65 the age under new pension scheme when you receive your full pension.]"

[qwerty2]

EP and CWU - thieves
Disgraceful

[Jaggs]

Looking at what Martin Walsh has posted it seems like we are going to have a CWU backed raid on our surplus. [

- "The EP agreement says we will get a share of the pension surplus when the Trustees are satisfied. There are two pension surpluses , the first is from the Care Scheme and the other. Is from the Cash balance which is smaller.

When we get a share it will go into the employee benefit scheme which will also generate 10% of any profit made by the company in future pay rises.

This surplus was at risk of going exclusively to EP. At the appropriate point the union and our democratic process including our conference with decide how we use it. There is a motion at this years conference asking the union to use the pension surplus to reduce from 67 to 65 the age under new pension scheme when you receive your full pension.]"

Where has Martin posted this?

[RobertT]

Where has Martin posted this?

viewtopic.php?f=1&t=119144

[RobertT]

It's always been possible for employers to get their hands on DB pension surpluses.
In the past, that usually happened once schemes were closed and decided to go through a buy in/buy out process.

In basic terms:
Buy in is when the scheme pays an insurer to provide members benefits, but still does the administering themselves.
Buy out is when the insurer takes full control.

When that happens there is often a surplus of cash, which legally the employer can often have, depending on the exact scheme rules.

There has recently been legislation passed which will enable DB pension schemes to release surpluses if the schemes are 'running on', which just means they're continuing as normal.
In that scenario, schemes could potentially grow their surpluses and therefore pay out more over the longer term.

It's unclear what's going to happen with the RMPP, but Martin Walsh seems to be suggesting it'll be buy in/buy out.
There is a precedent here, as the Post Office section of the RMPP went through that process a few years ago.

Saying that, ultimately it's the trustees that hold the purse strings and under the new legislation, they do have the power to award scheme members at least a share of any surplus.
That legislation can be read here: https://www.freshfields.com/en/our-thin ... us-102lp7j

In this video, CWU trustee member Lionel Sampson believes the members should get a share.
22.24 minutes in: https://www.youtube.com/watch?v=ZaJMQAAzC6E&t=1681s

Personally I think it's unrealistic to expect members to get all of the surplus, however ideal that may be. But I believe they should at least get some of it.
I would urge anyone who feels the same, to express your views to the RMPP trustees.

Their address is:

Royal Mail Pensions Trustees Ltd
Sixth Floor
1 George Yard
London
EC3V 9DF

[Jaggs]

Where has Martin posted this?

viewtopic.php?f=1&t=119144

Thank you.

[Hyrrokkin]

It's always been possible for employers to get their hands on DB pension surpluses.
In the past, that usually happened once schemes were closed and decided to go through a buy in/buy out process.

In basic terms:
Buy in is when the scheme pays an insurer to provide members benefits, but still does the administering themselves.
Buy out is when the insurer takes full control.

When that happens there is often a surplus of cash, which legally the employer can often have, depending on the exact scheme rules.

There has recently been legislation passed which will enable DB pension schemes to release surpluses if the schemes are 'running on', which just means they're continuing as normal.
In that scenario, schemes could potentially grow their surpluses and therefore pay out more over the longer term.

It's unclear what's going to happen with the RMPP, but Martin Walsh seems to be suggesting it'll be buy in/buy out.
There is a precedent here, as the Post Office section of the RMPP went through that process a few years ago.

Saying that, ultimately it's the trustees that hold the purse strings and under the new legislation, they do have the power to award scheme members at least a share of any surplus.
That legislation can be read here: https://www.freshfields.com/en/our-thin ... us-102lp7j

In this video, CWU trustee member Lionel Sampson believes the members should get a share.
22.24 minutes in: https://www.youtube.com/watch?v=ZaJMQAAzC6E&t=1681s

Personally I think it's unrealistic to expect members to get all of the surplus, however ideal that may be. But I believe they should at least get some of it.
I would urge anyone who feels the same, to express your views to the RMPP trustees.

Their address is:

Royal Mail Pensions Trustees Ltd
Sixth Floor
1 George Yard
London
EC3V 9DF

RobertT always on the button !

It is only fair that we get a fair share at least - 50% of any surplus.

The CWU have already decided (or soon will) what to with this if it happens without consulting the members.

In other words the last people to know or have no say will be us...as usual.

[Gary55]

Would any surplus be paid to retired members that paid in for years.

[clashcityrocker]

Would any surplus be paid to retired members that paid in for years.

Or to the relatives of people that paid in for years who have since died?

[RobertT]

The surplus only relates to the RMPP(2012-2024), and most of that is the pension element(2012-2018). With only a fairly small percentage relating to the Cash Balance(2018-2024).

So if you accrued benefits via the RMPP during those dates, you could and arguably should, be in line for some kind of payment.

The two options I've seen mentioned are an increase in pension, or a taxable cash payment at your marginal rate.
Articles I've read online (like this one) suggest to me the latter is more likely.
But only members who have reached the minimum pension access age of 55(57 from 2028) would be eligible.

I'm not sure whether those getting RMPP spouses benefits would get anything, but personally I doubt it.

It might also be worth mentioning that any payments employers get will also be taxable. They will pay 25% tax which the government have reduced down from 35% previously, as part of the recent legislation.

[claretandblue]

The surplus only relates to the RMPP(2012-2024), and most of that is the pension element(2012-2018). With only a fairly small percentage relating to the Cash Balance(2018-2024).

So if you accrued benefits via the RMPP during those dates, you could and arguably should, be in line for some kind of payment.

The two options I've seen mentioned are an increase in pension, or a taxable cash payment at your marginal rate.
Articles I've read online (like this one) suggest to me the latter is more likely.
But only members who have reached the minimum pension access age of 55(57 from 2028) would be eligible.

I'm not sure whether those getting RMPP spouses benefits would get anything, but personally I doubt it.

It might also be worth mentioning that any payments employers get will also be taxable. They will pay 25% tax which the government have reduced down from 35% previously, as part of the recent legislation.

So, being under 55 I wouldn't get anything, or I would, but only when I reach this age?

[Valentina@1]

The surplus only relates to the RMPP(2012-2024), and most of that is the pension element(2012-2018). With only a fairly small percentage relating to the Cash Balance(2018-2024).

So if you accrued benefits via the RMPP during those dates, you could and arguably should, be in line for some kind of payment.

The two options I've seen mentioned are an increase in pension, or a taxable cash payment at your marginal rate.
Articles I've read online (like this one) suggest to me the latter is more likely.
But only members who have reached the minimum pension access age of 55(57 from 2028) would be eligible.

I'm not sure whether those getting RMPP spouses benefits would get anything, but personally I doubt it.

It might also be worth mentioning that any payments employers get will also be taxable. They will pay 25% tax which the government have reduced down from 35% previously, as part of the recent legislation.

So, being under 55 I wouldn't get anything, or I would, but only when I reach this age?

Yeah Robert…could you clarify this a bit for us please if you could ?

[RobertT]

So, being under 55 I wouldn't get anything, or I would, but only when I reach this age?

Yeah Robert…could you clarify this a bit for us please if you could ?

I'm just repeating what I've read online about how DB pension schemes can distribute surpluses.

Here's a few links all saying basically the same:
https://www.ukemploymenthub.com/surplus ... -changing/
https://uk.practicallaw.thomsonreuters. ... Default%29
https://www.shoosmiths.com/perspectives ... yal-assent

My reading of it, is if you're 55(57 from April 2028) at the point of any surplus being paid out to members, you'll get your share. If you're under that age, I don't think you will.

[claretandblue]

Seems a tad unfair that only people aged between 57 and 67 get a payment.

[RobertT]

Seems a tad unfair that only people aged between 57 and 67 get a payment.

Who said anything about 67?

It's all dependent on the trustees and EP anyway.

They have to agree to specifically give RMPP members a share.