Unions and Pensions

Thicko2

Yes as i have said i know the benefits of my pension scheme many times above. It is clearly why we are fighting to retain most of it. DSHart 40% is perhaps too high, more like 30%, but clearly my proposed 13% and employer 14% we are getting pretty close.


This debate started about afforadbility and has now moved to fairness, an us and them debate with the private sector. However even with the private sector some good practice remains and we should aspire to this. Interestingly from what i can see, Tescos seems to be the model the government is basing its offer to the public sector on. Professional colleagues i went to university, professional career jobs etc, who did not retain final salary status etc are typically in 10% up to employer matching scenarios.

Tescos i beleive still offer a career average salary based scheme.

Certainly the bits i could see on their offer when they took over some RBS banking business was 5% employee and 11.1%. Spookily from a unite website see below.


Pensions –

The position of Pensions within TUPE legislation is that where an occupational pension scheme

exists, the receiving employer (i.e. Tesco) has to provide a pension with a maximum employer contribution
of 6% and is not required to replicate the existing pension arrangement. Tesco Bank is providing to all
transferring staff a Defined Benefits Pension Scheme (Tesco Pension Builder), regardless of whether staff
are in the RBS Defined Benefits Scheme or the Defined Contributions Scheme (Retirement Savings Plan).
Members who map across to Work Levels One and Two (WL1/2) will automatically join the Tesco Pension
Builder, where they will have to make an employee contribution of 5%, the employer contribution made
by Tesco Bank is 11.1%. However Tesco will provide a further consolidated pension supplement of 7.5%
for staff in the RBS Defined Contributions Scheme and 10% for staff in the superior RBS Defined Benefits
Scheme. This allowance on consolidation becomes pensionable and part of base pay. This supplement can
be invested in full or part into Tesco’s Additional Voluntary Contribution Scheme if staff want to make
pension savings on top of those already provided by the Tesco Scheme, with the residual % being taken as
cash. Staff can also opt out of the Pension Builder and take a 15% supplement to be invested in a private
pension or taken in part or full as cash.
The Tesco Pension Builder is a Career Average Pension Scheme, which is different to the existing RBS
Defined Benefits Scheme. All changes and differences within the scheme, including matters around the
Normal Retirement Age, Death in Service, Pension Accrual etc will be explained as part of the communication
process. Tesco Bank also intends providing illustrations to demonstrate that investment of the pension
supplement in the Tesco Pension Builder will provide comparable benefits to the RBS schemes. The Tesco
scheme is not a like for like replacement for the RBS schemes and there are both advantages and disadvantages
with the scheme in direct comparison to the RBS arrangements. Despite this Unite recognises and welcomes
the continued existence of a Defined Benefits Scheme when numerous employers have been busily closing
their schemes to new entrants and also the efforts that Tesco Bank have made to match as close as possible
the benefits within the RBS schemes. The option to take early retirement and receive an immediate non
reduced pension based on one weeks pay per year of service will cease on transfer to Tesco Bank, as this is

linked to the early retirement elements of the RBS Group Schemes.

gadgetmind

Thicko2 wrote: »

This debate started about afforadbility and has now moved to fairness, an us and them debate with the private sector.

It's not a matter of "us and them" or "grass is greener" but more whether what you're asking for is out of kilter and heading towards unreasonable or even (dare I say it) greedy. It's only by comparing like-for-like that you can get a handle on this.

dshart

While searching for details of Tesco's pension scheme I came across this article

http://news.bbc.co.uk/1/hi/business/1921807.stm

Have a read of it and tell me if it sound familiar to anything that is happening now (this article was 9 years ago). If all those employees had gone on strike where would they be now? Would the public sector workers have boycotted Tesco in support?

The_Angry_Jock

The thing with the majority of Tescos staff is that they are just over minimum wage. It's really only managers in the large stores who creep over national average salary.

AFAIK the cap is around 10.1% employer/5.4% employee plus you get a % of shares per year which much be held for 3 years to get tax free benefits. Some checkout operators can retire on a pretty comfortable income...but as I said above, they're on a low salary to begin with so it's not so much of a stretch when combined with the state pension.

My employer contributions match +1% to a maximum of 6%, last Christmas it got so tight they were talking about pulling the plug on it, but they got round that buy increasing our working hours (which equates to a 6% pay cut)...my company employs 30,000+ worldwide.

Thicko2

dshart - good article. I will post a good similar one from the guardian later, which shows the union involvement in the debate etc to reach the solution. I think Sir Terry and his top boys kept their 1/30th accrual rate and final salary but that may have changed now.

What tescos did 9 years ago - can be seen in what the public sector did in their negoitiations 4/5 years ago. e.g. new civil service was career average, 65 retirement age, increased contribution rates for employees who earn more etc. Done through agreement and the net result the infamous hutton graph showing % of GDP declining over the next 50 years from 2% To 1.4%. The similarities are real.

What we have had now is a government who has not negoitiated, i genuinely feel unions would have. Then at the last minute after the strike action is balloted ,increase their proposals on accrual rates and buying off the over 50s.

At a personal level i have limited issues with career average i think it is fairer.

Jock - within my hospital we still have employee porters/cleaners pretty close to tesco rates as well.

dshart

Thicko2 wrote: »

dshart - good article. I will post a good similar one from the guardian later, which shows the union involvement in the debate etc to reach the solution. I think Sir Terry and his top boys kept their 1/30th accrual rate and final salary but that may have changed now.

What tescos did 9 years ago - can be seen in what the public sector did in their negoitiations 4/5 years ago. e.g. new civil service was career average, 65 retirement age, increased contribution rates for employees who earn more etc. Done through agreement and the net result the infamous hutton graph showing % of GDP declining over the next 50 years from 2% To 1.4%. The similarities are real.

What we have had now is a government who has not negoitiated, i genuinely feel unions would have. Then at the last minute after the strike action is balloted ,increase their proposals on accrual rates and buying off the over 50s.

At a personal level i have limited issues with career average i think it is fairer.

Jock - within my hospital we still have employee porters/cleaners pretty close to tesco rates as well.

From what you say here it appears you agree that a change is required to ensure that public sector pensions are affordable. But how do you propose that this is done without people working longer or contributing more?

Koicarp

Among my colleagues most seem happy to pay more, but few are happy to work longer.

dshart

Koicarp wrote: »

Among my colleagues most seem happy to pay more, but few are happy to work longer.

No one will be forced to work longer, it will just mean you will have to accept a lower pension to retire earlier. The same option private sector workers have.

Meeper

They don't have to work longer. They can stop working whenever they like. They just won't be able to draw on the full pension benefits until that age.

Devon_Sailor

Andy_L wrote: »

Fire (& police) already pay 10%+

And how many times have they hit the streets on strike up to the point that they got there?