Stupid Question...

Post by **wacko74** » 28 May 2018, 18:51

Just to prove how little I understand even the basics of my pension... looking at my latest personal forecast it says I'll get £xxxx at 60 or £xxxx at 65.
Are those figures what I'll get with my current 17 years of contributions? Or are they a forecast of what I'll get if I carry on working and contributing (for another 20 years) until I'm 60 or 65??

Post by **Judgee** » 28 May 2018, 22:45

I believe they are based on the assumption that you will continue to pay into the scheme until those retirement dates.

BELIAL · Post by **BELIAL** » 28 May 2018, 23:53

You get no forecasts with the wing ding new CDC proposed scheme because you might get nothing

Driver74 · Post by **Driver74** » 28 May 2018, 23:58

Your forecast is based on what you have paid in to date not what might have paid in at nra 60 and 65

Post by **RobertT** » 29 May 2018, 03:53

The most recent annual statement gave a figure of what you've accrued up to 31st March 2017 and nothing else!
Previous statements did give forecasts of what you'd get by continuing to work until 65, but as the scheme closed to future accrual this year, continuing to do that would be pointless.

However, we did get an 'illustration' of what we might get at 60 & 65 if/when the proposed CDC scheme is introduced. These are in my opinion, wild guestimates based on certain assumptions which may or may not be true, and were produced to make that scheme look better than it's going to be in practice, and to encourage a yes vote. As such, they should be taken with a large pinch of salt.

The annual statement(the one with the squirrels on) is the important one, as that represents an accurate figure of what you've accrued to date!

Post by **wacko74** » 29 May 2018, 06:16

Thanks for the replies, yes it is the one with the squirrels on dated Sept 2017... so those figures represent an amount based on what I've accrued to date (which is a bit of a relief!)

BELIAL · Post by **BELIAL** » 29 May 2018, 21:54

Don't get too relieved cos in the small print it says that the adoption of the CDC scheme will be dependent on it being linked to existing schemes.
Now in a nice world you might think that would be intended to benefit the pensioner , but when was the last time the bonus grabbers did anything to improve your lot?

Post by **RobertT** » 30 May 2018, 04:33

BELIAL wrote:Don't get too relieved cos in the small print it says that the adoption of the CDC scheme will be dependent on it being linked to existing schemes.

No it doesn't!

If you read the CWU agreement booklet it specifically says: 'The proposed new scheme will not form part of the RMPP.'

BELIAL · Post by **BELIAL** » 31 May 2018, 20:50

RobertT wrote:
BELIAL wrote:Don't get too relieved cos in the small print it says that the adoption of the CDC scheme will be dependent on it being linked to existing schemes.
No it doesn't!

If you read the CWU agreement booklet it specifically says: 'The proposed new scheme will not form part of the RMPP.'

You might have missed this bit ??
Verbatim
' Because employees service prior to 2012 has transferred to the government backed RMSPS , then in order to work efficiently in the longer term the DBCBS proposal requires Cabinet Office approval to some rule changes to the Royal Mail Statutory Pension Scheme"
Pretty unambiguous I think you'll agree, and an essential step in the introduction of the CDC scheme. Question is , what does "Some rule changes to "RMSPS mean to a corporate body with the sole aim of maximmising profit? Retrospective legislation used to be a big fat no no.

Post by **RobertT** » 01 Jun 2018, 07:08

BELIAL wrote: You might have missed this bit ??

No I didn't! But you don't seem to understand it?

Because employees service prior to 2012 has transferred to the government backed RMSPS , then in order to work efficiently in the longer term the DBCBS proposal requires Cabinet Office approval to some rule changes to the Royal Mail Statutory Pension Scheme"
Pretty unambiguous I think you'll agree, and an essential step in the introduction of the CDC scheme. Question is , what does "Some rule changes to "RMSPS mean to a corporate body with the sole aim of maximmising profit? Retrospective legislation used to be a big fat no no.

The DBCBS is billed as a transitional scheme and is a new section of the RMPP, designed to fund the tax free lump sum when taking our already accrued pensions.

At the moment the DBCBS is only 'attached' to the element of our pensions that RM are responsible for, which is the RMPP(between 2012-2018). Therefore the tax free lump sum is limited to 25% of the value of your accrued 2012-2018 pension + the value of the DBCBS.

They need Cabinet Office approval to also link the RMSPS, which relates to our pre 2012 pensions and is the responsibility of the government. So that we can take a tax free lump sum of up to 25% of our total pension entitlement, rather than just 6 years of it!

The value of our DBCBS pot will then be treated in exactly the same way as the AVC(Flexiplan & Bonusplan) arrangements are, which are already linked to the RMSPS, except it will have an NRA of 65 or from 60 when taken with NRA60 benefits.

The CDC scheme along with the Defined Benefit Lump Sum Scheme when or if it is implemented, will be separate from both the RMSPS and the RMPP. The cabinet office approval of the DBCBS/RMSPS link is in no way dependant on the CDC scheme being introduced! They are two different things!

BELIAL · Post by **BELIAL** » 01 Jun 2018, 23:09

Thanks ,I understood it perfectly,despite the fact that it's clearly not meant to be clear.

They need Cabinet Office approval to also link the RMSPS, which relates to our pre 2012 pensions and is the responsibility of the government. So that we can take a tax free lump sum of up to 25% of our total pension entitlement, rather than just 6 years of it!

alarm bells ringing?

The CDC scheme along with the Defined Benefit Lump Sum Scheme when or if it is implemented, will be separate from both the RMSPS and the RMPP. The cabinet office approval of the DBCBS/RMSPS link is in no way dependant on the CDC scheme being introduced! They are two different things!

I think that is what is termed a Hegelian inversion. I think you'll find that the introduction of CDC scheme is very much dependant on the DBCBS being linked to the RMSPS scheme . To put it arse about face just looks like muddying the waters and who would want to do that?
Just to ground it though , we've gone from final salary pension -via cuts -to defined benefit pension -to the possibility of no pension whatsoever or CDC.

BELIAL · Post by **BELIAL** » 01 Jun 2018, 23:10

Thanks ,I understood it perfectly,despite the fact that it's clearly not meant to be clear.

They need Cabinet Office approval to also link the RMSPS, which relates to our pre 2012 pensions and is the responsibility of the government. So that we can take a tax free lump sum of up to 25% of our total pension entitlement, rather than just 6 years of it!

alarm bells ringing?

The CDC scheme along with the Defined Benefit Lump Sum Scheme when or if it is implemented, will be separate from both the RMSPS and the RMPP. The cabinet office approval of the DBCBS/RMSPS link is in no way dependant on the CDC scheme being introduced! They are two different things!

I think that is what is termed a Hegelian inversion. I think you'll find that the introduction of CDC scheme is very much dependant on the DBCBS being linked to the RMSPS scheme . To put it arse about face just looks like muddying the waters and who would want to do that?
Just to ground it though , we've gone from final salary pension -via cuts -to defined benefit pension -to the possibility of no pension whatsoever or CDC.

Post by **RobertT** » 02 Jun 2018, 03:58

toomuchcoke · Post by **toomuchcoke** » 02 Jun 2018, 16:27

BELIAL wrote:You get no forecasts with the wing ding new CDC proposed scheme because you might get nothing

Can you give an example of investment environment that would produce zero pension from a CDC scheme that wouldn't equally produce zero pension from either a DC or a DB scheme?

BELIAL · Post by **BELIAL** » 02 Jun 2018, 22:05

toomuchcoke wrote:
BELIAL wrote:You get no forecasts with the wing ding new CDC proposed scheme because you might get nothing
Can you give an example of investment environment that would produce zero pension from a CDC scheme that wouldn't equally produce zero pension from either a DC or a DB scheme?

Not from a DB scheme obviously because your pension is "defined".

As for CDC or DC schemes your guess is as good as mine . You pay your wages in and there is zero guarantee of any return. All risk has been transferred from the employer to the employee.
There could be a trade war;there could be a real war;there could be a natural disaster or climate change; there could be austerity policies or quantatative easing;devaluation or a run on the pound; the price of Brent crude might treble; RM might decide to sell off lots of prime real estate and reduce its workforce by 50%.