Royal Mail have new defined benefit pension scheme, with the FT reporting that:
" Royal Mail calculated earlier this year that the annual costs of maintaining its old defined benefit scheme would triple to £1.3bn if no changes were made. It said today that the new proposals could be funded under its existing £400m annual contributions."
It also reported:
"Royal Mail stressed that it “is one of few companies offering to replace one defined benefit scheme with another”, as many companies struggle to honour old pension promises."
However, the main union within RMG, the CWU; has rejected the offer as falling far short of RMG promises on pensions.
CWU deputy general secretary (postal) Terry Pullinger said:
"The CWU rejects the latest proposal from Royal Mail. It does not meet our aspiration of a wage in retirement pension scheme, but rather still promotes the conventional wisdom of a cash-out arrangement at the point of retirement.
"Whilst using elements of the CWU’s proposed Wage in Retirement Scheme, it would still represent a significant shortfall in the pensions promise and it is not something that we are prepared to recommend to our members."
Source: CWU / FT