Royal Mail Group and Post Office Limited have this week submitted controversial proposals to the CWU on further changes relating to the ongoing funding of accrued and future benefits within the Royal Mail Pension Plan.*
Both the Royal Mail Group and Post Office Limited have said that they have been advised that when the current triennial actuarial valuation is finalised, the employer's contribution rate is likely to rise. This rise, in their view, would be unaffordable and has prompted a review of current pension arrangements.
Deputy general secretary Dave Ward said that scheme members were "entitled to be confused, disappointed and angry" at the news, and added that the emergence of this issue at the same time as the company was preparing for privatisation raised "huge question marks over its legitimacy and legality.
"Members will be rightly alarmed as to why we now have another problem and we know that the scheme is not in deficit.
"It is inevitable that this issue will become not just a serious industrial matter but also a major political issue," he predicted.
Dave is sceptical in response to both companies' claims that the problems were completely unforeseen and argues that there could also be other factors involved.
"This is clearly linked to looming privatisation," he points out, adding: "a private investor coming into the company wouldn't want to pay the real cost of members' pensions.
At this stage, neither Royal Mail Group nor Post Office Limited have triggered the formal, statutory 60-day legal consultation, although the CWU understands that this could happen in the next few days.
"When that happens, we will call a special postal group conference specifically to deal with these proposals and their implications on privatisation and we will also challenge the Trustee Board to hold an extraordinary meeting for scheme members," Dave explained.
When the Postal Services Act came into force in 2011, the government took on responsibility for what was described as the "historic", or "legacy" deficit of the existing Royal Mail Group employees' pensions schemes - which was one area of this otherwise controversial Act that the CWU agreed with.
Dave said that the union has told Royal Mail Group, Post Office Limited, the Government and the Trustee Board that any further attempt to change pensions arrangements by executive action will be opposed by all means necessary.
"This is another reason why our members must vote yes in the consultative ballot and for our members in Post Office Limited it will only strengthen our resolve in the current dispute," he concluded.
*Pensions covered by the Government Scheme are not affected.
