Report into RM Pension comissioned by Postcomm

[belle smith]

http://www.psc.gov.uk/postcomm/live/pol ... report.pdf

Why is there such a big deficit?
Have a look at page 25 of this report. Sections 5.6 & 5.7 Royal Mail Pension scheme was over exposed to equities, this is very high risk strategy, especially for a buisness as labour entensive as RM. which is why the deficit is so bad.

Anyone remember being told at WTL that the pension holiday was not relevent, as RM would have to pay tax on any surplus over 105% of funding (belive this reffers to 1988 tax act, but not 100% on this) have a look at page 26. at the table in section 5.11 note the higher the equity allocation the higher the funding level. The pension scheme may have been so over exposed to the equities market because of the pension holiday!

The pension scheme moved from surplus to deficit between 2000 and 2003 when the stock maket fell. This would have had an impact on all pension schemes but especially ours.

the pension holiday was from 1990 to 2003.

page 27 specific events
2004 pay deal, baulk of pay rise was only paid once we achieved targets, Royal Mail were very clear that once targets were met full pay rise would be made pensionable they may not technically have lied but freezing the pension fund 4 years later seems duplicits.

redundacy programe, is this being accounted as a pension cost?

[norbert]

http://www.psc.gov.uk/postcomm/live/pol ... report.pdf

Why is there such a big deficit?
Have a look at page 25 of this report. Sections 5.6 & 5.7 Royal Mail Pension scheme was over exposed to equities, this is very high risk strategy, especially for a buisness as labour entensive as RM. which is why the deficit is so bad.

Anyone remember being told at WTL that the pension holiday was not relevent, as RM would have to pay tax on any surplus over 105% of funding (belive this reffers to 1988 tax act, but not 100% on this) have a look at page 26. at the table in section 5.11 note the higher the equity allocation the higher the funding level. The pension scheme may have been so over exposed to the equities market because of the pension holiday!

The pension scheme moved from surplus to deficit between 2000 and 2003 when the stock maket fell. This would have had an impact on all pension schemes but especially ours.

the pension holiday was from 1990 to 2003.

page 27 specific events
2004 pay deal, baulk of pay rise was only paid once we achieved targets, Royal Mail were very clear that once targets were met full pay rise would be made pensionable they may not technically have lied but freezing the pension fund 4 years later seems duplicits.

redundacy programe, is this being accounted as a pension cost?

interesting - that propaganda excuse about tax has been parroted out for nearly two years