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Providing Support for CWU Members in the Coventry Area Branch

Last Updated Friday, 20 June 2008

Pension Reform—Campaigning for a Fair Deal (cont..d)

 

 

The business expects to save around £120 million per annum as a result of this change.  The business has introduced this particular change on the clear basis that they believe this change will result in you losing out on your pension.

 

Perhaps the most savage attack on your pension is the decision to increase the pension retirement age from 60 to 65 for all pension service after 1st April 2010.  What this means is that for pension service earned up to April 2010 this will still be payable in full at age 60.

 

However for all the pension service after April 2010 this element will only be payable in full at age 65.  The key issues to remember about this pernicious change is:

 

If you choose to take this element of your pension before age 65 you will lose around 5% for each year you take it prior to 65.  So if you chose to take this element of your pension at age 60 you would lose around 25% of your pension.  A massive hit on your expected pension.

 

The longer you have to go to retirement age the harder this change will hit as more of your pension will be earned after 2010 and subject to this change.

 

The business expects to save £160 million per annum as a result of this particular change.

 

Whilst the CWU recognises that the businesses finances are under pressure and the cost of providing occupational pensions has become more expensive, the union believes these changes are far too draconian.

 

CWU members voted overwhelmingly to reject the businesses proposed changes in our recent consultative ballot, as did Royal Mail Group Managers in their Union consultative ballot.

 

The CWU have submitted counter proposals to the business that would allow the business to make substantial savings on their pension costs, but in a way that reduces the adverse impact on members pension benefits.  The business has rejected our proposals.

 

We are also raising the issue of pension provision in the current Government Review of the impact of competition on the business.  This independent review body has just produced an interim report that is helpful to the CWU’s case.

 

We will continue to press the business, Government and the independent review body for a fair deal on pensions.  We seek a negotiated settlement to this crucially important issue.  If it becomes absolutely necessary to further our campaign, we will ballot members for an industrial action mandate on this issue.

 

This is an issue that affects all members.  In fact the younger you are the harder you will be hit by the business imposed change, as more of your pension will be affected by these changes.

 

 

Royal Mail Pension Fund Page 2