£ 900

[hermon]

A couple of lines from today's statement-

We are grateful to the Trustees for agreeing to release the funds which enables us to give an additional one-off lump sum payment during this difficult period given the current cost of living challenges.

The release of the escrow is subject to final ratification of the agreement with the Communication Workers Union (CWU) in the member ballot.

Anyone able to explain if the trustees are able to release these funds, how they can possibly be dependent on us accepting the proposed pay and change deal ? Surely the whole point of trustees is that they are independent of RM ?

[Woody Guthrie]

The trustees have released the money to Royal Mail.
That's the beginning and end of their involvement.

Royal Mail have offered some of that money as part of the deal.
That's their decision, not the trustees.

[heapsy]

First I've heard of this. Getting diddly squat from our branch.

[Woody Guthrie]

The extra money issue is poorly communicated, it's not our money as the pension is fully funded and as a DB pension Royal Mail will always be liable for any shortfall,

As a surplus it was always going to be Royal Mail's money so the union has done well to return any of it to the members instead of it ending up in the hands of the shareholders. Like I said though not well communicated and the members will get the wrong end of the stick.

[posted]

So what makes this separately held and how is that identified in any pension accounting documents that we can see?

Under what circumstances can it be released and does it set any precedence?

Seems a bit odd, like suddenly finding a few million down back of the sofa.

If it’s pensions savings/contributions/growth then it should remain there IMO.

[Woody Guthrie]

If you read the pension financial statements it's always been there shown as a separate escrow account.

It can be released at any point, it was kept separately as an emergency funding measure if the pension was struggling.

Leaving it where it is does us no good because it's a defined benefit pension so even growth in the fund does not increase our pension.

The only danger from spending a surplus or buffer is if the fund goes into deficit it's down to the employer to make good but as this is a closed pension and has a relatively stable future liability model the risks of that are low.

[RobertT]

As I've recently left RM, to be honest I no longer care about the nuts and bolts of this agreement. But to to me, this is a case of raiding the family silver, to use as a bribe to get the agreement passed.
It's short termism. Nothing more, nothing less!

And for what? A lump sum of less than 2 weeks pay in your pockets!

Only last year, the RMPP was under pressure due to the LDI crisis, where the tried and tested formula of investing in bonds and gilts was shown to be not necessarily the safe haven it's always been.

If the Bank of England hadn't intervened, many pension schemes could have been up sh!t creak by now.
That has has generally subsided since the dark days of September 2022, but it certainly hasn't gone away.

As a member of the RMPP, albeit now deferred, I would much prefer this money to stay in the Escrow account. To be available if and when it's ever needed and for the purpose it was intended.

[Woody Guthrie]

It really didn't serve a purpose though from our point of view.
Royal Mail is liable for any shortfall in the RMPP anyway.

The longer it sat there with the RMPP fully funded the more likely Royal Mail was to attempt to access it to use it to fund a shareholder dividend or waste it on some other bright new idea.

It may be short termism from Royal Mail's point of view but from the union's point of view in the long term members would not have seen a penny of it.

[RobertT]

It really didn't serve a purpose though from our point of view.

It's an emergency dip in fund, which serves a great purpose in my opinion. It's something everyone should have.

Royal Mail is liable for any shortfall in the RMPP anyway.

That's the same Royal Mail who are losing money hand over fist, and struggling to compete with more nimble opposition in the parcels market?

The longer it sat there with the RMPP fully funded the more likely Royal Mail was to attempt to access it to use it to fund a shareholder dividend or waste it on some other bright new idea.

From what I gather it was the CWU who initiated the 'Escrow raid'. Seems like a direct attempt to turn the tide towards a yes vote and bribe the membership into voting for something most don't seem to want. Ably assisted by RM

It may be short termism from Royal Mail's point of view but from the union's point of view in the long term members would not have seen a penny of it.

Whoever gets that money, it's still a case of raiding the family silver.
They've sold off valuable real estate, they've paid £millions to themselves and shareholders and now they're dipping into the pension emergency fund.

Sooner or later, there'll be nothing left and they'll be after more and more of your terms, conditions and jobs.

But as long as you're getting a few hundred pounds after deductions now, makes it ok?

[hermon]

Thanks for the replies to my initial post.
Interesting if it is RMs money, that these smash and grab gangsters aren't attempting to use it for a short term dividend payment !
£130M (or whatever it is) must seem like a good investment to get us to agree to watered down terms and conditions as this will only be the thin end of the wedge.
So that's an even bigger red flag than attempting to bribe us with our own money as I initially thought !

[Slim2none]

It really didn't serve a purpose though from our point of view.

It's an emergency dip in fund, which serves a great purpose in my opinion. It's something everyone should have.

Royal Mail is liable for any shortfall in the RMPP anyway.

That's the same Royal Mail who are losing money hand over fist, and struggling to compete with more nimble opposition in the parcels market?

The longer it sat there with the RMPP fully funded the more likely Royal Mail was to attempt to access it to use it to fund a shareholder dividend or waste it on some other bright new idea.

From what I gather it was the CWU who initiated the 'Escrow raid'. Seems like a direct attempt to turn the tide towards a yes vote and bribe the membership into voting for something most don't seem to want. Ably assisted by RM

It may be short termism from Royal Mail's point of view but from the union's point of view in the long term members would not have seen a penny of it.

Whoever gets that money, it's still a case of raiding the family silver.
They've sold off valuable real estate, they've paid £millions to themselves and shareholders and now they're dipping into the pension emergency fund.

Sooner or later, there'll be nothing left and they'll be after more and more of your terms, conditions and jobs.

But as long as you're getting a few hundred pounds after deductions now, makes it ok?

I think it's generally agreed on here that Robert is the defcato "go to guy" on this forum as far as pension advice goes along with his knowledge and experience of working for RM.

If Robert thinks this is another example of "selling off the family silver" then I for one, am prepared to listen. In this instance, yet again, he is entirely correct.

[posted]

As I've recently left RM, to be honest I no longer care about the nuts and bolts of this agreement. But to to me, this is a case of raiding the family silver, to use as a bribe to get the agreement passed.
It's short termism. Nothing more, nothing less!

And for what? A lump sum of less than 2 weeks pay in your pockets!

Only last year, the RMPP was under pressure due to the LDI crisis, where the tried and tested formula of investing in bonds and gilts was shown to be not necessarily the safe haven it's always been.

If the Bank of England hadn't intervened, many pension schemes could have been up sh!t creak by now.
That has has generally subsided since the dark days of September 2022, but it certainly hasn't gone away.

As a member of the RMPP, albeit now deferred, I would much prefer this money to stay in the Escrow account. To be available if and when it's ever needed and for the purpose it was intended.

My thoughts too. If it’s there as backup for the pension on rainy days then makes no sense to use it for an entirely different purpose on a sunny day.

[renrag40]

Why should we have any confidence in Royal Mail being able to cover any deficit in the pension when they are in such a parlous financial situation? They were threatening, in their usual bullying way, to go into administration a few weeks ago knowing full well they would have access to this escrowed money.
Absolute s***house of a company..

[Woody Guthrie]

The experts in Royal Mail's pension position are the trustees and their advisors and if they have decided with all the proper facts to hand that the escrow account is unnecessary I defer to their expertise over a retired postie.

The argument over "family silver" is simplistic and shows a complete lack of understanding in how Royal Mail's funding obligation works.

It makes just as much sense to say that any money they give us in any pay deal is the "family silver" since it is all just cash on the balance sheet.

I'm kind of disappointment in your selfish attitude Robert, active members need financial help now, you may not have any interest in this deal and are only worried about your own pension but the vast majority of us do not wish to see that money rotting away in an escrow account until Royal Mail see fit to do what they want with it.

[Geordiepapa]

The experts in Royal Mail's pension position are the trustees and their advisors and if they have decided with all the proper facts to hand that the escrow account is unnecessary I defer to their expertise over a retired postie.

The argument over "family silver" is simplistic and shows a complete lack of understanding in how Royal Mail's funding obligation works.

It makes just as much sense to say that any money they give us in any pay deal is the "family silver" since it is all just cash on the balance sheet.

I'm kind of disappointment in your selfish attitude Robert, active members need financial help now, you may not have any interest in this deal and are only worried about your own pension but the vast majority of us do not wish to see that money rotting away in an escrow account until Royal Mail see fit to do what they want with it.

As a now retired postie who has probably paid into the pension scheme for many years then I do think Robert has a right to be concerned about his pension but I do not think that is the purpose of his post at all. He is merely showing concern at how wrong this proposed action is. Also Woody, do you think it's right that all staff will be paid this POSSIBLE £900, and that includes managers who have been well bribed and "looked after" over the past year or so? There's too many ifs and buts in this agreement for me to vote yes.