Post Office attacks workers pensions

[TrueBlueTerrier]

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Post Office workers were hit with a second shock announcement today (Tuesday) with the news that the company plans to close their defined benefit pension scheme.

With workers already worried about their futures after last month’s news of large-scale Crown office franchising (link to Crown offices web story: http://www.cwu.org/media/news/2016/janu ... le-s-post/" onclick="window.open(this.href);return false; ), this morning’s notification that the business is set to open a 60-day pension scheme consultation has added further to staff woes.`

In a letter to branches, CWU assistant secretary Andy Furey explained that the process is due to open this coming Friday (February 5th) and relates to the proposed “closure of the Post Office (Defined Benefits) Section of the Royal Mail Pension Plan (RMPP), which will affect those members who joined the scheme prior to 1st April 2008.

“Under the proposals,” Andy continued, “the defined benefits (DB) scheme would be closed to any new benefit accrual and members would build up benefits in a new Defined Contribution (DC) scheme from 1 September 2016.”

This new DC scheme will also include current members of the DC scheme.

Meeting at CWU national headquarters today, the CWU industrial executive will be debating these proposals, which Andy is describing as “an attack on our members’ rights

“The Post Office has rushed into this 60-day process without any meaningful dialogue with the CWU and without allowing any opportunity for alternatives to be explored,” he pointed out, accusing management of having presented union negotiators with “a fait accompli.”

Scheme members will “suffer twice” under the changes proposed, Andy said, explaining: “Members will lose future accrual and they lose the difference between the Retail Price Index (RPI) and the Consumer Price Index (CPI) revaluation on the benefits they have built up.

“And on top of all this, the scheme is in surplus – not in deficit. So not only is this all extremely unfair – there is no financial case for the changes either.

Executive members will be asked to back calls to campaign against the Post Office’s proposals, and letters of protest have already been sent to Post Office minister Baroness Neville-Rolfe and Royal Mail Pension Trustee Chris Hogg requesting urgent meetings to formally set out the union’s objections.

In the meantime, a home mailing has been sent to all affected and potentially affected members with full details of the union’s position and further information.

In urgent correspondence to Baroness Neville-Rolfe, Dave Ward wrote: “CWU members have seen significant changes to their pension entitlements in recent years which we have worked with the Post Office in order to help protect the scheme and keep it open. The union is not opposed to any change, but we cannot accept that there is any need to close the scheme when the Post Office itself is forecasting that the surplus will last until late 2022.”

And deputy general secretary Terry Pullinger said: “This is another scandalous attack on hard-working Post Office employees and their future pensions.

“Separation of the Post Office from Royal Mail has not only had a negative impact on the public, with more unwanted office closures and franchising, but will now result in a significant worsening of our members’ future pension provision.

“The union will strongly oppose these unfair and unjustified changes”.



For further information, see (link to LTB 063/16)

[TrueBlueTerrier]

Letter to Branches





No:063/16
Ref: 115
Date: 2nd February 2016

TO: ALL BRANCHES WITH POSTAL MEMBERS


Dear Colleague

POST OFFICE: PENSIONS - DEFINED BENEFIT SCHEME – PROPOSAL TO CLOSE THE SCHEME

The Post Office has today announced a 60 day member consultation, from Friday 5th February until 5th April, in respect of its plans to close the Post Office (Defined Benefits) Section of the Royal Mail Pension Plan (RMPP).

Post Office Proposal

The Post Office recently advised us of its plans to close the Defined Benefits (DB) pension scheme, which will affect those members who joined the scheme prior to 1st April 2008. Under the proposals, the DB scheme would be closed to any new benefit accrual and members would build up benefits in a new Defined Contribution (DC) scheme from 1 September 2016. The new DC scheme will also include members of the current DC scheme.

Despite our strong objections to the unnecessary haste of commencing the 60 day members’ consultation in relation to the plans, the Post Office is pressing ahead and members will begin to receive documentation and information from this morning on the plans.

Our key objections to the Post Office’s plans are as follows:

The Post Office is rushing into “consultation” with members of the DB scheme without meaningful dialogue with the Union. Just two formal meetings on this issue have been held and in both of these meetings we were presented with what seemingly is a fait accompli. In our view, the Post Office is conducting a tick box exercise in its “consultation” with both the Union and the members of the scheme and is determined to press ahead with closure of the scheme, whatever the outcome of the “consultation”.

The DB scheme is not in deficit - there is sufficient surplus with £136.1m as at 30th September 2015 to allow the scheme to continue until 2022. This surplus was created by members giving up benefits and should be viewed as members’ money.

We estimate the Post Office will save over £5m a year under the proposal as the current contribution is 17.1% per member into the DB scheme, compared with a greatly reduced contribution into the proposed new Defined Contribution scheme.


We understand that after closing the scheme, the Post Office intends to de-risk it by moving into very low yielding assets or even by buying out the benefits with an insurance company. This will remove the scheme from the Post Office’s balance sheet.

We do not accept the Post Office’s case for the scheme closure and believe members’ money should be spent on benefits, not used to subsidise the business.

Steps we have taken thus far are as follows:

Dave Ward, General Secretary has written to Baroness Neville-Rolfe, the Post Office Minister BIS, seeking an urgent meeting regarding pensions and the future of the Crown Office Network.

We have written to Neil Hayward, Group People Director, Post Office, raising our concerns over the Post Office’s plans, and in particular, the unnecessary haste to commence a fait accompli “member consultation”.

A letter has been sent to Chris Hogg, Chief Executive, Royal Mail Pension Trustee, seeking an urgent meeting and also raising our objections to the Post Office’s plans. In this regard, a meeting has been arranged for later this week.

Hilary Salt, specialist pensions advisor from First Actuarial has been instructed to provide advice and guidance to the Union. We will continue to seek Hilary’s advice as matters progress.

Next Steps

The Postal Executive is receiving documentation at its statutory meeting today. Following this meeting we will issue a further LTB reporting on Postal Executive Policy on this important and complex issue.

Members will be receiving a Union communication to home addresses this week, outlining our serious concerns with regards to the Post Office’s attack on their pensions. A copy is attached for your information. In the meantime, Branches are urged to encourage members not to react to this news by leaving the DB pension scheme.

Further developments will be reported at the earliest opportunity.

If you have any questions in relation to this LTB, please contact Lea Sheridan - lsheridan@cwu.org.

Yours sincerely



Andy Furey
Assistant Secretary

[mark.cup]

What a bunch of low life's we work for!