Royal Mail denies plan to abolish final salary pension scheme

The Royal Mail has hit back at union claims that it is planning to abolish its final salary pension scheme as part of a plan to scale back a £6bn shortfall in its pension fund.

The Communication Workers Union (CWU) said Royal Mail had received copies of a document which proposed increasing the age at which staff can retire with a full pension from 60 to 65 in 2010. The proposed changes would affect the pensions of 170,000 postal workers.

Jon Millidge, director of employee relations, however, wrote a letter to CWU stating that the document was “out of date” and denying that any decision had yet been made on pension provision.

He said: “The company has already made it very clear that our number one priority is to protect as far as possible the pension provision for our existing employees.

“You accept, and have asked us to cost out for you, that for the defined benefit scheme to be kept open to new recruits, then our existing people would have to work longer and pay more into the scheme because of the future risk to the company of not closing the scheme,” he added.

Millidge said Royal Mail had not yet put any proposal forward to the pensions consultation group and that formal consultation would not take place until that happened.

“Clearly at this stage we are still considering the views of the CWU and all other stakeholders and continue to work with you to develop the proposals,” he concluded.

Royal Mail has been at loggerheads with CWU in recent weeks over pay and modernisation, leading to two major strikes.

Comments are closed.