Whilst it may have been the intention of Parliament to preserve the pensions of NATS staff what the Transport Act actually did was to make it almost impossible for NATS to change the Trust Deed which sets out what those benefits are. What is protected are the benefits as defined in that deed. It appears that those benefits are defined according to pensionable pay but exactly what is pensionable pay doesn't seem to be protected. It may be semantics but that is of course what the law is all about and how lawyers ensure the future of their profession. In NATS the concept on some elements of pay being non pensionable is far from new, over the years bonus parts of the annual pay settlement have been non pensionable and most of the blood money bribes were also non pensionable.
The trust of promise ensures that members of the pension scheme at PPP can remain members as long as they are employed by NATS. Currently there is no protection at all for anybody who joined since PPP although it is to be hoped that their colleagues would take some action to protect them if NATS tried to force them out of the scheme. The 15 year MOU might actually give those people more protection than they currrently have.
NATS can't recover all its costs because the Government decided that as a monopoly it should be regulated. The Government appointed regulator then decided that NERL was too expensive and should be subject to an RPI-x charging regime to encourage efficiencies. That same regulator has indicated that it is not prepared to allow NATS to recover all its pension costs in charging period 3 hence the problem. That regulator is of course appointed by the same Government that some people on this forum think would look after our pensions if we were re-nationalised.
There seems to be a great deal of misunderstanding about not for profit. Yes NATS makes a profit but almost all of the profit is ploughed back into the business either by paying off loans or as investment. If you look at the Annual report you'll see that there has been quite significant investment at the same time as reducing the total debt. Only a small amount of the profit has left the business as dividends, 5% of which went to NATS staff. Were NATS to make large profits which were distributed to shareholders the regulator would soon step in and stop it. Indeed it is likely that if NATS was to use the profit to fund pension payments rather than investment the regulator would reduce the amount it can charge accordingly.
This particular office chum won't be taking any industrial action likely to preserve the pensions of operational staff at the expense of my job. The amount I might lose in pension by the RPI cap pales into insignificance compared to the amount lost if I'm not a member of the scheme until retirement.
Last edited by eglnyt; 11th Oct 2008 at 23:33.
Reason: response to promise question