Pension Payments

[Expeditedescent]

Don't know if this is common knowledge, but I only found out recently, and I have to say it made me feel pretty sick.

It seems that while NATS enjoys a significant pension holiday to the detriment of operational staff, it seems only certain grades are affected. NATS management are still haveing contributions paid by the company, and so are the watch managers.

I wonder if any other ATCO 1 grades are still having pension contributions paid by NATS?

[roger]

(if true) I'm not suprised. These double standards will eventually lead to revolt. Hopefully sooner than later, morale is at an all time low.
We all need to speak to the union reps to register our disgust with the poor management of our company.
When I say our company I'm sure I've got a couple of shares somewhere....
roger

[spekesoftly]

In what way is the pension holiday detrimental to operational staff ? My understanding is that an employer can only take a pension holiday if there are still sufficient funds to service the pension scheme's liabilities. This has to be agreed and approved by the trustees, some (all ?) of whom are elected by the members. It is also worth remembering that should the funds prove at any time to be insufficient to meet liabilities (i.e. pay pensions) then the employer has to meet the deficit, with increased contributions, and not the employees. That's just one of the many advantages of a 'final salary' pension.

I agree that excluding certain members from the pension holiday does require explanation!

[Undercover]

The Pension contribution holiday has NO effect on your pension or what you are entitled to.

There is one big pot of money, from which we will all be due our share. The company is responsible for making sure that when the day comes for you to dip into the pot, that your share is there in full. What they do with the pot up till that point is up to them. If there is a surplus then it is there's to do with as they see fit. Those are the perks of taking the responsibility to top it up if things don't go so well.

There's so many people seem to believe that NATS are in some way playing with "their" pension. When your salary goes into the bank on pay day, do you ask your bank manager how he and his corporate bosses plan to invest that money until such time as you decide to withdraw it? Pretty much the same principle.

[Findo]

Expedite. Where exactly did you get this information ?

NATS management are still haveing contributions paid by the company, and so are the watch managers .

All the negotiated grades are on the same terms and conditions, in the same pension scheme. So why would NATS pay contributions for a small, but lovely :rolleyes: group of individuals ?

[Rage]

Spekesoftly – a pension holiday IS detrimental to staff because there is a distinct possibility, as a result, that the company contribution in the future will increase to an unsustainable figure. The future outcome is likely, at best, to be the closing of the scheme to new members and, at worst, the closing of the Sheme completely.

Undercover is naïve to think that NATS would simply pour money in as required in the future for, whilst companies indeed have a MORAL obligation to fund their pension schemes adequately, this is not currently backed up by adequate legislation. As a result, we are currently witnessing many companies taking advantage and reneging on their obligation and why should a cash-strapped NATS be any different? Banking legislation is much more mature and so the analogy is spurious.

On the point made by Spekesoftly in respect of Trustees, it is well known that the members Trustees advised against this pension holiday. This advice was ignored by the Trade Union side who were ‘bought’ by an improved benefits package which, in all likelihood, us younger scheme members will never see.

The undertaking given in respect of pension provision at the time of the PPP can also be avoided legally, should NATS choose or be unable to pay the required contributions at some future stage. The following is a quote extracted from a letter written by one of the member Trustees in November 2001:

“Legal advice tells us that if NATS does not or could not pay the required contributions, the Trustees may be forced to wind up the NATS Section, in accordance with the provisions of the Statutory Instrument. As it would be the Trustees instigating this NATS would not be in breach of Clause 3.1 of the Trust of Promise which would thus not give any protection.”

The information relating to Directors pensions payments can be found in the NATS Statement of Accounts recently published. A sum of £17,200 was paid to augment the pension of McNulty on leaving the company. Sums of £35,400 and £5,200 were paid to a 'funded unapproved retirement benefits scheme for benefits above the earnings cap' for Everitt and Fotherby respectively. In addition Everitt and Fotherby are members of the NATS Section of CAAPS which is subject to the earnings cap. We can see, therefore, that although NATS is unwilling/unable to continue to contribute to the NATS Section at present, it is willing to continue to fund personal pension pots of directors.

I just hope that the present Directors are still around when it all hits the fan but I suspect that won’t be the case………

[Expeditedescent]

Findo,

I heard it from a Supervisor on my watch who was told directly by the WM himself. This was then confirmed by another supervisor the next day.

My belief is this is genuine, but I did want to see if anyone else had come across this, or knew more about it than myself.

Rage, thank you for a very well written response.....even if it did make me extremely uncomfortable to read.

[qwerty2]

Thankyou Rage for putting things so clearly.
I've been trying to get this message across for months but the naivety of some of my colleagues is staggering as these threads demonstrate too clearly.

[jocko0102]

Dont trust management it is as simple as that.
Remember the 62k.
Plus cast your minds back to a certain fat git called R Maxwell.
Bet you a lot if not all the staff didnt think too much about a tweak here or there in the pension fund until ....oops!

[Findo]

Expedite. Someone is confusing the Senior Management Group (SMGs) with other people. As part of their pay settlement about 7 years ago ( I think ) NATS offered to reduce our percentage payments into the pension fund. The unions rejected this move preferring to increase the benefits available towards the maximum allowed under Inland Revenue rules. The SMG group had no such representation and their pension contributions were decreased. If any extra payment was made in the last year it was to fulfil this contractual obligation.

Not all Watch Managers are SMGs (if any) and it certainly does not apply to any other negotiated grade from SATCO to ATCO 3.

It appears to be Rage's view that this consistent policy adopted by our Union was being "bought out". I disagree. It has brought about one of the very best pension schemes in the UK and one which all NATS staff will fight to not only retain but improve.

[Rage]

Findo

I agree that the policy adopted by the union is consistent in continuing to obtain improvements in benefits for members. I believe, however, that the decision was wrong on this occasion and both Tony Cowell (members’ trustee) and Barry Gibbs (retired members’ trustee) were of this view during the pensions holiday negotiations. If one were cynical it could be said that adopting this policy on this occasion almost immediately benefits certain involved individuals who were approaching retirement.

Obtaining enhanced benefits simply puts the future finances (and therefore viability) of the Scheme under more pressure which could hasten the demise. Should this happen then it is the existing pension holders whose rights are retained with the rest of the members picking up the scraps – hence the earlier assertion that younger members may never see any of the benefits, let alone any improvements negotiated.

When challenged at the time, the union position appeared to be that ‘they (NATS) are legally entitled to take a holiday so there’s nothing that can be done’. It is also legal for NATS to offer a 0% pay rise over the next five years but would we/the union have accepted that so readily………?

Don't get me wrong, I know that many union committee members give up a lot of time and do much valuable work on behalf of members. On this occasion, however, I simply believe that the decisions made were incorrect in the long term.

[Findo]

Sorry to continue disagreeing Rage but obtaining enhancements to the pension scheme is less likely to put the scheme in danger than obtaining a 10% pay rise and therefore increased payouts to the members on retirement.

The scheme will be funded so that it meets it's liabilities and a reasonable surplus retained for contingency. We don't actually have any power to stop NATS taking a holiday as long as those liabilities can be met. Trying to act against this would not be a legitimate trade dispute. By contrast a percentage of the surplus was used to convert to increased members benefits and agreement made on the regular monitoring of the scheme so that NATS restarts it's contributions when necessary.

Now if they did not do that or attempted to end the Final Salary scheme THEN :mad: we would be in a legitimate dispute.

[Rage]

Findo

Again, granted that salary increases also increase the liabilities of the Scheme but in this case at least we get our hands on this salary increase element upfront.

I also take heart that you're obviously on the inside as you're so confident that NATS management will continue to honour their obligations.

Insofar as regular monitoring of the scheme is concerned, a six monthly review of the Scheme by the actuary was due on 30 September. I note that the figures and report following this interim review are 'not yet available' as of 13 November and, while I appreciate that such matters take time, six weeks is rather too long.

The scenario I fear most having a number of years to go to retirement is that NATS decide to close the current Scheme to new entrants. Current members would be loathe to undertake industrial action on behalf of new employees as there would be no directly perceived benefits. The problem arises when the proportion of contributing members to the 'old' final salary Scheme reduces significantly compared to that of younger members of the replacement defined benefits scheme. NATS could then decide to close the 'old' scheme which would not affect any of the younger employees. A division would be created in terms of industrial action - fait accompli.

BA went about the strategy in a slightly different way by trying to amalgamate their two separate pension schemes and they've learned an awful lot from their experience.

[Findo]

Well Rage you and I fundamentally disagree. Nice to do so in a civilised manner. Having a maximum of 10 years to go before retirement I would have no hesitation in saying ATCOs of "my" generation would walk out the door tomorrow if there was a proposal to change the final salary scheme.

It would probably not benefit us directly but we would do it without hesitation. This is not entirely altruism but a fact that we have been educated over the years that the collective good is in all our best interests- long and short term.

[Rage]

Maybe, but let's just hope that the situation doesn't arise in the first place....

NATS has always been a bit behind the times but has eventually copied the latest management fad, be it mission statements, straplines, useless charters etc. etc. and we all know what the current trendy money saving strategy is.

[Findo]

The pension review details should be known by mid September.

Undercover ... you usually have a management answer for these things. Why is the review late ?