Pension rumours

[stephen500]

Lot's of rumours regarding our final salary scheme after conference. Haven't a clue what is true. If any one can enlighten us, please do. Thanks.

[POSTMAN]

There are 2 posts below this one,Pension Update & Royal Mail set to announce further change to pensions.

[stephen500]

There are 2 posts below this one,Pension Update & Royal Mail set to announce further change to pensions.

I know looking for further updates before deciding whether to leave the Royal Mail pension scheme and invest elsewhere.

[fishtank]

There are 2 posts below this one,Pension Update & Royal Mail set to announce further change to pensions.

I know looking for further updates before deciding whether to leave the Royal Mail pension scheme and invest elsewhere.

Leave it where it is.
Any changes will first of all be subject to a 60 day consultation and even then it's unlikely the changes would be immediate.....there was talk of a 5 year guarantee.
Even after all that and if the changes go ahead you're still unlikely to find a better private pension investment than the pre-2010 scheme to transfer your pension into and you would likely lose heaps on transfer even assuming you can.
Hold tight is what i'm saying.

[stephen500]

There are 2 posts below this one,Pension Update & Royal Mail set to announce further change to pensions.

I know looking for further updates before deciding whether to leave the Royal Mail pension scheme and invest elsewhere.

Leave it where it is.
Any changes will first of all be subject to a 60 day consultation and even then it's unlikely the changes would be immediate.....there was talk of a 5 year guarantee.
Even after all that and if the changes go ahead you're still unlikely to find a better private pension investment than the pre-2010 scheme to transfer your pension into and you would likely lose heaps on transfer even assuming you can.
Hold tight is what i'm saying.

So depressing! What is there to look forward too.

[borders]

I think Pensions should be no. 5 on the CWUs list on reasons why we should strike

[stephen500]

No answer to e mails to Moya Greene, Trustees, Minister for Business. Dave Ward gave a reply as best he could. In a vacumn rumours develop. I would have like to have thought the trustees protect us, I have my doubts!

[fishtank]

I think Pensions should be no. 5 on the CWUs list on reasons why we should strike

I think it would have been if RM had announced the consultation like they were supposed to but they appear to be...hesitant.
That can only be a good sign.

[stephen500]

I think Pensions should be no. 5 on the CWUs list on reasons why we should strike

I think it would have been if RM had announced the consultation like they were supposed to but they appear to be...hesitant.
That can only be a good sign.

According to the Postal services Act the secertary of state can only ammend the scheme up to 2008 with the consent of the members.

[fishtank]

According to the Postal services Act the secertary of state can only ammend the scheme up to 2008 with the consent of the members.

That does not apply to the final salary link.
The responsibility for maintaining the link to final salary remains in the hands of Royal Mail and they can change it with the agreement of the trustees.

The trustees are legally obliged to put the overall integrity of the scheme above all else which means if Royal Mail can put forward a case to them that the scheme in it's present form is no longer financially sustainable they will more or less have to agree to change it.

[stephen500]

According to the Postal services Act the secertary of state can only ammend the scheme up to 2008 with the consent of the members.

That does not apply to the final salary link.
The responsibility for maintaining the link to final salary remains in the hands of Royal Mail and they can change it with the agreement of the trustees.

The trustees are legally obliged to put the overall integrity of the scheme above all else which means if Royal Mail can put forward a case to them that the scheme in it's present form is no longer financially sustainable they will more or less have to agree to change it.

I can't get my head around this. Up to 2008 the government has taken on the responsibilty of the scheme. It is only since 2008 that they are responsible for. So it is surely only the rise in income link that they (Royal mail) pay out. So I can't see how they are liable for so much? I know a few now who are just taking the pension at 55. I can't do that for another couple of years. But I will do if I have to then and as said if I have to I will take my money out and invest elsewhere. I will never advsie my children to take out pensions. It's all a con.

[RobertT]

I can't get my head around this. Up to 2008 the government has taken on the responsibilty of the scheme. It is only since 2008 that they are responsible for. So it is surely only the rise in income link that they (Royal mail) pay out. So I can't see how they are liable for so much?

As far as I'm aware, the government are liable for pension built up to April 2012, but RM are responsible for any pay related increases in the final salary (up to April 2008) element of it. So if our wages go up by 3% this year ( I know it's a big if) , RM will be liable for the corresponding increase in our pensions.

I know a few now who are just taking the pension at 55. I can't do that for another couple of years. But I will do if I have to then and as said if I have to I will take my money out and invest elsewhere.

I should take independent advice on both of these options if I was you, as the 5% per year reduction for taking it early will be with you for life and in 99% of cases transferring out of a final salary pension is the wrong choice.

[2old4this]

35 years on delivery. a little under 4 years left till I'm 60. What the hells going on.

[stephen500]

35 years on delivery. a little under 4 years left till I'm 60. What the hells going on.

Wow if I had 4 years to go, I don't know what I would do. If the rumours are right about a 5 year gurantee for final salary I would hold on. When we hear some thing concrete be prepared to act quickly and may be take it. But don't take my advice. Indpendent financial advice is called for!

[stephen500]

I have tried to do some research on changes to pensions. An article (Q and A) from the Daily Telegraph suggests that existing benefits cannot be retrospectily adjusted. (Unless of course, the law is changed!) So it looks highly unlikely that benefits acrured can be changed. More likely that the final salary scheme going forward could have the link withdrawn. However it appears that Royal Mail may protect the next five years. The article in the Telegraph reads "Is my existing pension affected by these changes?
No, all pension benefits accrued to date are protected. So, for example, if you have worked for the company for 20 years and for each year have earned a fixed proportion of your salary to date as a pension, this will still be paid at retirement. However, it does mean that from now any future benefits won't be dependant on your salary, but what is paid into the new defined contribution plan." So fingers crossed if you are not too far from your pension you willl be ok. Well that's what I am hoping!