Royal Mail set to announce further change to pensions

[Martin Walsh]

Royal Mail have until the end of June to announce the 60 day consultation process for protential further change to our pensions.

Royal Mail wish to change the fact that all service post 2008 is still calculated on your final salary when your take your pension.

Royal Mail's proposal will protentially mean that if introduced their will be a surplus of nearly 2 billion ! Quite a nest egg for someone wanting to buy Inge business !!!

[RobertT]

Royal Mail have until the end of June to announce the 60 day consultation process for protential further change to our pensions.

Royal Mail wish to change the fact that all service post 2008 is still calculated on your final salary when your take your pension.

All pension pre 2008 is still currently calculated on a final salary basis when you take you pension-something the CWU negiotiated at the time I seem to remember. Post 2008 is average salary.

Royal Mail's proposal will protentially mean that if introduced their will be a surplus of nearly 2 billion ! Quite a nest egg for someone wanting to buy Inge business !!!

As all pension before 2012 is in the hands of the government, so if this is true it will be George Osbourne that will get this £2 Billion.

[Martin Walsh]

Robert this announcement is expected to be just after Easter as informed to the CWU. No the surplus will not go to the government as the surplus will be in the fund which has now been separted from the Government and is a stand alne scheme.

[Martin Walsh]

Robert just retread my original thread and I made the mistake as you corrected all service before 2008 is based on the final salary and Royal Mail believe that the money which was allocated by the Government is not enough and hence the reason why they have told that they will be activating the consultation process.

[fishtank]

Are you saying that Royal Mail are planning to retrospectively remove the link to final salary from pensions accrued up to 2008 dingo?

Are you 100% sure on this?

[Martin Walsh]

Yes fish that is exactly what I am saying and yes I am sure !

[fishtank]

Yes fish that is exactly what I am saying and yes I am sure !

This will start a riot.
RM agreed to maintain the link as part of the agreement for state aid.
Do they intend to explain to the EU that they have moved the goalposts?
Will they be taking back the deficit and paying back the loans to Government?
Are they even on the same planet as the rest of us?

[Martin Walsh]

Yes it will . This is why it pensions was discussed at last weeks briefing . Royal Mail are nervous as there were meant to announce the consultation this week and has now been pushed back a couple of weeks Easter is a good time to bury bad news .

[RobertT]

Are you saying that Royal Mail are planning to retrospectively remove the link to final salary from pensions accrued up to 2008 dingo?

When the final salary pension scheme closed it was decided that when we take our FS pension it will be paid out on the basis of what our final salary is at the time. So if i were to take mine today it would be based on what I earn today.

However if this is to change there could be a couple of possible outcomes:
1) All pension built up to April 2008 will be paid based on what we were actually earning in 2008.
2) All pension built up to April 2008 will be paid based on what we are earning when the change happens, presumably later this year or early 2014.
i think both options should then uprated by inflation each year.

As far as I'm aware, retrospective changes to pension schemes are against the law, so option 2 is far more likely.

[fishtank]

No change to RMSEPP though I would imagine.
Still running a deficit on the boardroom perks,paying massive pensions to past failures.

[fishtank]

Are you saying that Royal Mail are planning to retrospectively remove the link to final salary from pensions accrued up to 2008 dingo?

When the final salary pension scheme closed it was decided that when we take our FS pension it will be paid out on the basis of what our final salary is at the time. So if i were to take mine today it would be based on what I earn today.

However if this is to change there could be a couple of possible outcomes:
1) All pension built up to April 2008 will be paid based on what we were actually earning in 2008.
2) All pension built up to April 2008 will be paid based on what we are earning when the change happens, presumably later this year or early 2014.
i think both options should then uprated by inflation each year.

As far as I'm aware, retrospective changes to pension schemes are against the law, so option 2 is far more likely.

I cannot see how either option would save Royal Mail any money,In fact linking pensions to inflation(CPI or RPI) would probably cost RM more since our basic(pensionable) pay rises usually come in well below both figures.

[stodgy88]

what effect will this have on people already taking their pension .

[RobertT]

what effect will this have on people already taking their pension .

None.

[fishtank]

I wonder if they also plan to remove the right to take pre-2008 pension accrual early?

[RobertT]

I wonder if they also plan to remove the right to take pre-2008 pension accrual early?

I shouldn't think so. They only increased the minimum age you can take a pension from 50 to 55 three years ago.