Pension update

[POSTMAN]

From Dingo...

On pensions Royal Mail are still nervous about announcing the consultation because they will know that it will disturb an hornets nest. If nothing happens prior to the 30 th June the pension regulator will write to the employer asking what it intends to do. Royal Mail are still saying to the union that if they do nothing they will have to increase their contributions to 28% and they cannot afford that. Their position is still to change the final salary link to RPI that is all service prior to 2008. This would only be guaranteed for 5 years and of course then it could be changed again by who ever owns Royal Mail. Unlike the previous position the change would be immediate and no one who has service prior to 2008 would be protected.

[DGP1]

I don't mean to sound stupid but I thought the government took over the liability for the pension scheme prior to last year (I think) so they pay out for all the previous years service and it's only the new pensions that RM has to pay for.

Please tell me I'm not being a bit thick.

[fishtank]

I don't mean to sound stupid but I thought the government took over the liability for the pension scheme prior to last year (I think) so they pay out for all the previous years service and it's only the new pensions that RM has to pay for.

RMG will continue to bear all future service costs, including liability for any current obligations under the RMPP to maintain a continuing final salary link together with certain enhancements (for example on early retirement) in respect of the historic pension benefits.

This means that after the pension relief, RMG will continue to bear the risk that the historic liabilities for deferred members may increase by reason of any salary increases, which exceed price inflation, as the pension benefits have to be linked to the current final salary level

[DGP1]

I don't mean to sound stupid but I thought the government took over the liability for the pension scheme prior to last year (I think) so they pay out for all the previous years service and it's only the new pensions that RM has to pay for.

RMG will continue to bear all future service costs, including liability for any current obligations under the RMPP to maintain a continuing final salary link together with certain enhancements (for example on early retirement) in respect of the historic pension benefits.

This means that after the pension relief, RMG will continue to bear the risk that the historic liabilities for deferred members may increase by reason of any salary increases, which exceed price inflation, as the pension benefits have to be linked to the current final salary level

I hope I'll be able to understand this when I'm a bit more sober but does it mean that the government took the money and then didn't agree to actually fund the liabilities

Maybe we should just have given them the billions as an act of charity and starved in our old age (not that many of us will get there ).

[nataddick]

Where is this news coming from ? Why are the CWU not sharing full details with the membership - particularly at a time they are seeking support via the consultative ballot. Snippets are appearing in the forums but the source documents are not so that members with an interest in this subject are unable to get their heads around what is happening!

[taxi4leighton]

the ft100 has risen by over 15% over the last 12 months.
it is at the highest level in years
so you would assume that our pension scheme would be healthier than it has been for years
never trust a Tory

[RobertT]

the ft100 has risen by over 15% over the last 12 months.
it is at the highest level in years
so you would assume that our pension scheme would be healthier than it has been for years
never trust a Tory

The assets of the pension scheme used to be heavily invested in the stock market, I think it was something like 80% - 90% of them at one point. But quite a large proportion is now invested in fixed interest bonds and gilts, which are safer but don't provide the potential returns or flutuations of equities.

[taxi4leighton]

nethertheless the performance must have improved since the government took responsibility of our pension.