ATC IssuesA place where pilots may enter the 'lions den' that is Air Traffic Control in complete safety and find out the answers to all those obscure topics which you always wanted to know the answer to but were afraid to ask.
The point so many have tried to make is that pension-holiday money might have been used for some of the inappropriate purposes you suggest. Please don't insult an intelligent workforce by inferring that the accounts are anything but a smoke-and-mirrors exercise for the gullible....a masterpiece of creativity and denial.
Business costs include many elements, among them for example are wages and pensions.....a competent management plans a financial strategy to fund all expenditure both current and predicted.
Always remember this....if management were any good they would not be working for us.
All financial accounting is smoke and mirrors and NATS is no exception. The slight difference is that NERL does everything in the spotlight of regulation so it's all out there if you want to look. It's quite hard to plan a half decent conspiracy if you have to publish everything and the regulator has plenty of staff more than qualified in unravelling the NATS accounts.
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a competent management plans a financial strategy to fund all expenditure both current and predicted.
Interestingly that's exactly why we've been having this debate over 1205 posts. NATS management has identified a hole in the accounts and the need to do something about it. I don't like the fact there is a hole and I'm not happy with the effect on my pension but I'd rather we were having this conversation than it being put in the too hard drawer until it's too late. Like NATS and the NTUS I don't think doing nothing is an option.
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if management were any good they would not be working for us
Presumably you could argue the same about all of us who could earn more elsewhere. In my opinion this particular set of management are better than those that went before them. That doesn't mean there isn't better out there and it doesn't mean I like the pressures that come from being a company rather than a cosy Government agency but they have far more idea of real management than the time served people who previously occupied those posts. Given the cards the Government dealt them post PPP I think they've done as well as could be expected, we will never know if somebody else could have done better.
The pension holiday saved NATS from going under. If you don't believe that take a look at the two reports written by the National Audit Office, they are both available on line. If you think it was used instead for inappropriate purposes I'd like to see the evidence for that.
I don't think anyone is confusing profit for spare cash. The £60m profit this year is the final figure in the finance sheet (i.e what's left after EVERYTHING has gone into the NATS bank account and EVERYTHING has been paid...including pension costs!!) so the pensions have already been paid before the profit is even announced.
Now if you have an extra £150m (or whatever barstewards figures come to...i'm far too hungover to add them all up) in the bank then it clearly becomes easy to pay the £125m pension costs, and still have money left over which can then be posted as a profit...whether the regulator lets us keep that profit or not is another question, but the point is, the increased pension costs have been paid using the extra money from not repaying loans etc!
Simple question...had the £80m(???) NOT been repaid early, what would the profit figure have been?
Seems fairly straight forward to me, but as mentioned, I am hungover!!
The profit is the final figure after everything has been paid but it's only there because the Regulator allows it to be. The Regulator and NATS agree the amount of investment required and the scales of charges are set to allow, if all the smoke and mirrors are in the right place, that amount of profit to drop out the end. The profit is then scooped up and used to pay for capital investment. If NATS used the money to fund pensions it won't drop out the end and can't be used for investment. At that point the Regulator is going to be a little bit upset because he only agreed the scale of charges on the basis that the profit would be used for investment. Now he might just say never mind but somehow I doubt it.
Simple question...had the £80m(???) NOT been repaid early, what would the profit figure have been?
Simple question but no simple answer. If they repaid the loans of out of cash the profit would have been £80 million more. If they repaid the loans out of different borrowing the profit would be the same. The answer is somewhere in the middle but probably much nearer the same than £80 million more.
OK guys lets have a show of hands...who are the crazy ones on here that are going to vote yes??......and another thing who are the crazy ones that have not sold their shares back!! I reckon valuation in january will be 40% down on present value!!
Does not the regulator only apply to NERL not NSL?
If so should not the fund be split in two so that they can then be financed under the rule as there is an argument that NSL's pot is being retricted by NERL?
I know that NERL makes more money than NSL but NSL is not retricted by CP2 and 3.
The above are all talking points only, I don't think that we should be split up, and our pension should be left alone. If you vote yes NSL WILL be sold off in the next few years.
You are quite right NSL could potentially still fund the current pension if its customers are willing to bear the extra cost. The amount of profit on each airport contract is commercially sensitive and not published so we don't know which, if any, airports could support that extra cost. It is unlikely that many of the current contracts could and equally unlikely that many of the airports would be happy to negotiate new contracts with that kind of rise in cost. Certainly NATS management don't think they would if you look at the yellow posts in the NATSNET discussion.
NSL may be sold off or it may not. This particular vote won't make much difference to that outcome as the "new" pension arrangements will still be viewed as quite expensive by many potential suitors.
Dividends are payments made by a corporation to its shareholder members. When a corporation earns a profit or surplus, that money can be put to two uses: it can either be re-invested in the business (called retained earnings), or it can be paid to the shareholders as a dividend.
If you vote yes NSL WILL be sold off in the next few years.
Statements like this should not be used unless you have 100% evidence that it is true. You made finite statement and I hazard a guess that you have absolutely nothing to go on except speculation. It is a dangerous thing to do and somewhat unfair to those people who read this and do not fully understand the debate.
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Originally Posted by eglnyt
NSL may be sold off or it may not. This particular vote won't make much difference to that outcome as the "new" pension arrangements will still be viewed as quite expensive by many potential suitors.
This is exactly the situation. Our pension is still terribly expensive and these changes do nto make it any more attractive. Not in the slightest! Besides, why would NATS sell of NSL when it is one of the main contributors to NATS debt and costs?! Remember NSL is unrestricted... (Now we just need some better negotiators... )
The pension holiday saved NATS from going under. If you don't believe that take a look at the two reports written by the National Audit Office, they are both available on line. If you think it was used instead for inappropriate purposes I'd like to see the evidence for that.
I was sure the pension briefing was quite clear that the pension holiday never saved us from going under, it helped our cash flow but it was only the new investment from HMG and BAA that saved us from going bust.
If NATS didn't pay off the £65 million loan early* (plus £15 million early redemption charge) then profits would have been considerably higher, there is no doubt about this. Profits in the future will also be higher because of this early repayment.
*Your credit card analogy is erroneous. Loans and mortgages are structured over a defined period of time to give the lender a healthy return. Paying them off early incurs a sizeable early repayment charge, in this case £15 million. Paying off your credit card early does not involve these charges.
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Originally Posted by terrain safe If you vote yes NSL WILL be sold off in the next few years.
Statements like this should not be used unless you have 100% evidence that it is true. You made finite statement and I hazard a guess that you have absolutely nothing to go on except speculation. It is a dangerous thing to do and somewhat unfair to those people who read this and do not fully understand the debate.
I will give odds of 25/1 that NSL will not be sold off by 2015. any takers, show me the money.pm me. i accept paypal.
I was sure the pension briefing was quite clear that the pension holiday never saved us from going under, it helped our cash flow but it was only the new investment from HMG and BAA that saved us from going bust.
Technically it was the £30 Million short term loan from the Treasury that actually stopped NATS going bust. It was the composite solution that got NATS back from the brink to a more stable financial footing. There were a number of elements in that composite solution all of which were required for it to work. One of those elements was £120 Million of savings within NATS of which the pension holiday formed a part. I'm not quite sure of the distinction between improving cash flow and stopping the company going bust, the two are normally equivalent for a company in the state that NATS was at the time.
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If NATS didn't pay off the £65 million loan early* (plus £15 million early redemption charge) then profits would have been considerably higher, there is no doubt about this. Profits in the future will also be higher because of this early repayment.
Certainly higher but considerably higher ? It may be true but you can't justify that statement on the information in the public domain. As much of the repayment appears to have been financed by additional borrowing in NERL my guess would be about £15 million which was the redemption cost. There is no doubt that NATS expects to make savings as a result of that move because nobody spends £15 million unless they will and of course those savings will reflect in the profit figure in the future. I'm slightly puzzled that you think there is something wrong in that. Remember that the RPI-x formula for the bulk of its income means that NATS has to find savings year on year just to stay in the same place and if it makes those savings with financial manipulation it isn't making them through staff cuts which is the inevitable end game with an RPI-x charging regime.
Could you expand on your statement that the Regulator only allows NATS to make a profit in order to fund the investment program.
If your statement is factually correct then how is NATS allowed to pass on profits as dividend payments to shareholders?
The Regulator accepts that shareholders are entitled to make a reasonable return on their investment and the charging regime makes allowance for that. It is the Regulator's view that the dividend policy is a matter for the NATS board not the Regulator but there are a number of checks and balances in the system to stop the Board "acting irresponsibly". The Regulator has allowed full pass through of the Capital Investment programme in CP2 and as long as NATS funds that investment programme as agreed and provides the services required in the licence it can use any additional profit to pay dividends if the Board choses to do so. To date the Board has chosen to pay only modest dividends which is in keeping with the stated objectives of the Airline Group.
I'm not quite sure of the distinction between improving cash flow and stopping the company going bust, the two are normally equivalent for a company in the state that NATS was at the time.
Nor I, yet management are quite categorical that it wasn't the pension holiday that stopped the company going bust.
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I'm slightly puzzled that you think there is something wrong in that
I don't, I'm merely pointing out the company is now in a position to make even more profits. I have nothing against the company making profits but we shouldn't be misled over the financial state of the company.
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Remember that the RPI-x formula for the bulk of its income means that NATS has to find savings year on year just to stay in the same place
Such as paying off loans early. Increasing their credit rating and therefore reducing interest rates on loans.
Isn't it a bit cheeky that on the careees website NATS are trying to attract new traines with "an attractive remuneration package which includes a contributory final salary pension scheme, generous annual leave, a variety of voluntary benefits and family friendly policies"
I sincerely doubt that those about go through the recruitment process will start with NATS before March 2009.
With an already highly UNattractive trainee salary, and now a new UNattractive pension scheme, how long will people continue to be interested in taking a career change and decide to come and work for NATS ?
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Originally Posted by terrain safe If you vote yes NSL WILL be sold off in the next few years.
Statements like this should not be used unless you have 100% evidence that it is true. You made finite statement and I hazard a guess that you have absolutely nothing to go on except speculation. It is a dangerous thing to do and somewhat unfair to those people who read this and do not fully understand the debate.
Do you have evidence in a legally binding document that NSL will not be sold off ? Ok, I guess you don't, that's why we speculate.
It's a question of common sense and NATS management won't rule it in, or rule it out. Which usually means they will sell NSL as soon as practically possible
) in the bank then it clearly becomes easy to pay the £125m pension costs, and still have money left over which can then be posted as a profit...whether the regulator lets us keep that profit or not is another question, but the point is, the increased pension costs have been paid using the extra money from not repaying loans etc!
You must be an ERIC 
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