Royal Mail bosses have put themselves on a collision course with postal workers after announcing their intention to slash the pensions of around 90,000 workers. This scandal – and the fightback against it – was one of the main discussion points in Bournemouth this week at the conference of the CWU, the union representing postal workers.
Royal Mail bosses have put themselves on a collision course with postal workers after announcing their intention to slash the pensions of around 90,000 workers.
The company has been in talks with union reps for months as part of a so-called consultation process, but in a blunt about face they declared there was “no alternative” but to close its final-salary pension scheme in March 2018, a year from now.
The scheme is presently in surplus to the tune of £1.8bn. But the company has warned that workers could be faced with increased contributions as pay-outs increase. This means abandoning the promises it made to postal workers at the time of privatisation.
As expected, there is massive opposition from members to the closure of the final-salary scheme, which will mean that those who retire will be forced to live on poverty pay. Under management plans, employees could lose between a third and a half of their pensions.
This scandal – and the fightback against it – was one of the main discussion points in Bournemouth this week at the conference of the CWU, the union representing postal workers.
A 50 year-old earning £25,000 a year and retiring at 65 would lose £4,392 a year, and more than £100,000 over the course of their retirement, explained the CWU.
The whole thing sticks in your throat when you see that Royal Mail chief executive Moyà Greene is paid £1.5 million a year and gets £200,000 paid into her pension. This sums up the whole way in which privatised profit-making works, where the bosses receive obscene salaries and perks while ordinary workers, who do the real work of delivering the service, are treated like dirt.
The CWU negotiating team has however submitted a counter proposal to Royal Mail called the Wage in Retirement Scheme (WinRS). This is an alternative to the company’s proposed transfer of all employees into the defined contribution scheme from the current defined benefit scheme. The main difference in the WinRS scheme is that it would invest mainly in equities rather than gilts, as is currently the case, the yields from which have been falling due to quantitative easing. It also puts some of the risk on the scheme members rather than solely on the company.
This situation is being closely watched by many other unions and interested parties as, if accepted, it should provide a better pension for members than what is currently being proposed.
If there is no agreement then Royal Mail workers remain on a collision course with the company to get what was promised to them.
The pension issue is only one side of the coin though. Royal Mail are crashing headlong into a confrontation with its workers through its post-privatisation drive to slash costs, in an effort to appease shareholders and their thirst for profits.
Of course, this can only be achieved by the bosses attacking the terms and conditions of their staff. The result will be to create a two-tier workforce, giving new starters inferior benefits, such as less sick pay, no allowances and no shift payments.
It is crucial that any settlement agreed by the CWU and Royal Mail applies to all members, whether new starters or full/part-time. Anything else can only be divisive in the long run; and this at a time when workers need to fight as one, not just to improve our working lives, but to maintain what we’ve fought so hard for previously.
With management intransigence, these attacks are likely to lead to industrial action. Postal workers are faced with no alternative by to fight for their future.
This scandal – and the fightback against it – was one of the main discussion points in Bournemouth this week at the conference of the CWU, the union representing postal workers.
