Royal Mail Sets Out Pension Plan Proposals After Union Talks

[TrueBlueTerrier]

http://www.lse.co.uk/AllNews.asp?code=b ... nion_Talks" onclick="window.open(this.href);return false;

Royal Mail PLC on Friday set out proposals for its pension scheme, following talks with unions on a plan for after the end of March 2018, when the scheme in its current form will close to future accrual.

It is now offering members a choice between a defined benefit scheme and a defined contribution scheme, which would be set up as new sections of the plan, replacing the current sections that will close to future accrual next March.

The defined benefit cash balance scheme would provide members with a guaranteed lump sum at retirement. Royal Mail's contribution to members' retirement accounts would increase to 13.6% from 12.6%, and it would contribute a further 2% for other member benefits, including death in service and ill health. Members' retirement accounts would be credited with 19.6% of pensionable pay every year.

As an alternative, members would have the option of joining a new defined contribution scheme. The company contribution would be 13.6% of pensionable pay.

Royal Mail said that it will make improvements to its existing defined contribution plan from April 2018, proposing increasing its standard contribution by 1% in each tier up to a maximum of 10% from this point.

Royal Mail said it expects the overall cost of this proposal to be funded from its current GBP400 million annual pension contribution. It said it believes the risk from the proposed scheme would be "materially lower" than its current plan, and a "manageable risk" for Royal Mail.

Union Unite is planning to hold a consultative ballot of this proposal, Royal Mail said it understands, and the company also has offered this improved proposal to the Communication Workers Union.

Shares in Royal Mail were down 0.2% at 410.40 pence Friday, shortly after the market open.

[Rommagic]

Has it been rejected by the Cwu?.

[TheTrolleyMan]

Kick Ito the kerb , remember RM senior management are the best paid in our industry and are lucky to have jobs