Pension Surplus

[Wullie10]

Another point. All this pension surplus won't be simply cash but Government gilts ( borrowing) . So to release the surplus to hand to the owners to do as they wish if the trustees agreed, then billions of gilts would need to be sold. Would that push up Government borrowing even more ?

[TopperGas]

History repeats itself. Reeves plan sounds like
Thatchers pension holiday plan in the 80s. We'll obviously it isn't the same in that Royal Mail will still be paying into the plan , but the sentiment is there. Politicians again fiddling with pensions to get themselves out of a hole.

Thatchers government decided pension surpluses should be taxed, amongst other things, so some schemes took payment holidays to avoid that.
The one the RM took was a massive 13 years(1990-2003).

Thatchers pension changes: https://www.professionalpensions.com/fe ... d-pensions
RM's holiday: https://www.express.co.uk/news/uk/87061 ... sion-break and https://www.standard.co.uk/hp/front/the ... 41762.html

I don't understand how money can be "" trapped "" in a pension . It's ridiculous. That ""trapped"" money they want to get their hands on could some day be needed. If pension benefits are unable to be met then they are backed by the tax payer which is us. A pension fund is for the retirement of people who have paid into the system. Not a speculative gamble to see if they can create a surplus to hand out to shareholders.

Up to now, surpluses often became available to be redistributed following a buy out, which is when a closed DB scheme pays an insurance company to provide members benefits via an annuity.
Any left over cash is then no longer needed to pay benefits and so has to go somewhere.

These new plans from RR, enable surpluses to be accessed much easier than before and importantly while the scheme is still paying out benefits itself. Which as you say, is potentially a recipe for disaster if the recent good times come to an end.

Personally I would much rather see the RMPP surplus stay exactly where it is for the time being and at some point in the future when we have a better idea of long term prospects, or when a buy out happens, distributed amongst scheme members.

The trustees do still have the final say on if, when or how much surplus is extracted and whether at least some of it could be used for the benefit of members.

No wonder the new owner wants his greedy hands on RM
It is OUR money - it should ALL go to us - either by staying where it is or some kind of distribution among the paying members ie to pay a lump sum into a SIPP/PP etc etc. (or something along those lines)
I notice the only people who do not get a say on this are us the pension members !
I would like some kind of vote to decide what happens as this is a massive amount of OUR money.
Would Martin Walsh if he is reading this come on here and justify the theft of OUR money by RM & CWU.

Is really our money when we personally have never paid into the fund, it was paid in by RM to give us a percentage of our wages as a pension and by chance has got a better return than was anticipated.

[Hyrrokkin]

History repeats itself. Reeves plan sounds like
Thatchers pension holiday plan in the 80s. We'll obviously it isn't the same in that Royal Mail will still be paying into the plan , but the sentiment is there. Politicians again fiddling with pensions to get themselves out of a hole.

Thatchers government decided pension surpluses should be taxed, amongst other things, so some schemes took payment holidays to avoid that.
The one the RM took was a massive 13 years(1990-2003).

Thatchers pension changes: https://www.professionalpensions.com/fe ... d-pensions
RM's holiday: https://www.express.co.uk/news/uk/87061 ... sion-break and https://www.standard.co.uk/hp/front/the ... 41762.html

I don't understand how money can be "" trapped "" in a pension . It's ridiculous. That ""trapped"" money they want to get their hands on could some day be needed. If pension benefits are unable to be met then they are backed by the tax payer which is us. A pension fund is for the retirement of people who have paid into the system. Not a speculative gamble to see if they can create a surplus to hand out to shareholders.

Up to now, surpluses often became available to be redistributed following a buy out, which is when a closed DB scheme pays an insurance company to provide members benefits via an annuity.
Any left over cash is then no longer needed to pay benefits and so has to go somewhere.

These new plans from RR, enable surpluses to be accessed much easier than before and importantly while the scheme is still paying out benefits itself. Which as you say, is potentially a recipe for disaster if the recent good times come to an end.

Personally I would much rather see the RMPP surplus stay exactly where it is for the time being and at some point in the future when we have a better idea of long term prospects, or when a buy out happens, distributed amongst scheme members.

The trustees do still have the final say on if, when or how much surplus is extracted and whether at least some of it could be used for the benefit of members.

No wonder the new owner wants his greedy hands on RM
It is OUR money - it should ALL go to us - either by staying where it is or some kind of distribution among the paying members ie to pay a lump sum into a SIPP/PP etc etc. (or something along those lines)
I notice the only people who do not get a say on this are us the pension members !
I would like some kind of vote to decide what happens as this is a massive amount of OUR money.
Would Martin Walsh if he is reading this come on here and justify the theft of OUR money by RM & CWU.

Is really our money when we personally have never paid into the fund, it was paid in by RM to give us a percentage of our wages as a pension and by chance has got a better return than was anticipated.

So what it is still our money - we and RM paid into a pension fund to benefit it's members.

[TopperGas]

History repeats itself. Reeves plan sounds like
Thatchers pension holiday plan in the 80s. We'll obviously it isn't the same in that Royal Mail will still be paying into the plan , but the sentiment is there. Politicians again fiddling with pensions to get themselves out of a hole.

Thatchers government decided pension surpluses should be taxed, amongst other things, so some schemes took payment holidays to avoid that.
The one the RM took was a massive 13 years(1990-2003).

Thatchers pension changes: https://www.professionalpensions.com/fe ... d-pensions
RM's holiday: https://www.express.co.uk/news/uk/87061 ... sion-break and https://www.standard.co.uk/hp/front/the ... 41762.html

I don't understand how money can be "" trapped "" in a pension . It's ridiculous. That ""trapped"" money they want to get their hands on could some day be needed. If pension benefits are unable to be met then they are backed by the tax payer which is us. A pension fund is for the retirement of people who have paid into the system. Not a speculative gamble to see if they can create a surplus to hand out to shareholders.

Up to now, surpluses often became available to be redistributed following a buy out, which is when a closed DB scheme pays an insurance company to provide members benefits via an annuity.
Any left over cash is then no longer needed to pay benefits and so has to go somewhere.

These new plans from RR, enable surpluses to be accessed much easier than before and importantly while the scheme is still paying out benefits itself. Which as you say, is potentially a recipe for disaster if the recent good times come to an end.

Personally I would much rather see the RMPP surplus stay exactly where it is for the time being and at some point in the future when we have a better idea of long term prospects, or when a buy out happens, distributed amongst scheme members.

The trustees do still have the final say on if, when or how much surplus is extracted and whether at least some of it could be used for the benefit of members.

No wonder the new owner wants his greedy hands on RM
It is OUR money - it should ALL go to us - either by staying where it is or some kind of distribution among the paying members ie to pay a lump sum into a SIPP/PP etc etc. (or something along those lines)
I notice the only people who do not get a say on this are us the pension members !
I would like some kind of vote to decide what happens as this is a massive amount of OUR money.
Would Martin Walsh if he is reading this come on here and justify the theft of OUR money by RM & CWU.

Is really our money when we personally have never paid into the fund, it was paid in by RM to give us a percentage of our wages as a pension and by chance has got a better return than was anticipated.

So what it is still our money - we and RM paid into a pension fund to benefit it's members.

RM could equally argue that their share of the money paid in is their''s not ours, it's odd after all these years there's no clear law on what happens to surplus money in employee pension funds

[RobertT]

RM could equally argue that their share of the money paid in is their''s not ours, it's odd after all these years there's no clear law on what happens to surplus money in employee pension funds

I think it's fair that RM get a share, but the problem is there doesn't seem to be any surplus going specifically to RMPP members.

There were previous laws which said defined benefit schemes had to pay tax on any surplus, so many configured their investments accordingly, or took payment holidays.

However over the years many fell into deficit, which was the reason most have closed. So what to do with surpluses wasn't a problem.
That's changed over the last few years as a result of government bonds, which many DB schemes are invested in, providing better returns than previously expected, hence many schemes now have a large surplus.

At least members of the new RMCPP won't have that to worry about, as any extra cash in the overall pot will result in higher pensions for all.