UK - NATS Pay negotiations - latest rumours

[landedoutagain]

To continue from del prado's post

an increase in pension costs would only add to the apparent shortfall in the CP2 budget

there wont be any shortfall in budgets! That was supposed to be the whole point behind capping the pensionable pay remember? The figures are already based on RPI +.5 fixed for 15 years, so the required amount is known. It will reduce if there is no pay rise of course, but then it will also have reduced somewhat because they have stopped the scheme for newcomers.

That post is either a mistake on your part egnlyt, or spreading of misinformation and scaremongering...

[eglnyt]

there wont be any shortfall in budgets!

If NATS budgetted for a positive growth in income during CP2 and we are currently seeing -10% which may last for up to two years then there can only be a shortfall in the budget. Be careful not to confuse budget shortfall with loss, you can make a profit and still have a shortfall in your budget. NATS reckons the shortfall between what it expected as income over CP2 and what it will actually get is £90 million. You can argue about that figure but it looks consistent with a -10% growth over 18 months. That £90 million includes the reduction in pension contributions because of the agreement. If we had voted No NATS would have been unable to limit the pension contribution in the way it has and therefore the figure would have been greater than £90 million. If £90 million shortfall equals £45 million of savings equals X number of jobs then > £90 million shortfall equals > £45 million of savings equals >X jobs.

Not scaremongering, just the way it is and slightly irrelevant because we voted Yes. I was only countering those who argued that we should have voted No.

Shortfall? We've been making 50 million profits for each of the last 5 years. I can't wait until this year's financial results are published.

The £90 million shortfall must already include any profit we make this year which should be quite big because the downturn in income only took effect from the Winter schedules and NATS makes all its profit in the Summer. Although it has been making profits it has spent most of that money on the capital investment programme and reducing its debt. It hasn't been putting it away for a rainy day so previous profits aren't going to help much. Remember also that under current accounting methods quite a few NATS staff are actually paid for by the capital investment programme and therefore their jobs are dependant upon NATS being able to fund that investment and funding that investment depends upon being able to reinvest the profit.

[PPRuNe Radar]

Although it has been making profits it has spent most of that money on the capital investment programme and reducing its debt.

And an alleged 13% pay rise for our glorious leader let's not forget.

[anotherthing]

And an alleged £50 million dividend this year to the airlines... but even after the dividend has been paid clear profits are rumoured to be in excess of another £50 million plus...

[Del Prado]

Be careful not to confuse budget shortfall with loss, you can make a profit and still have a shortfall in your budget

Just not quite as big a profit as you'd like?


BTW, the 10% reduction you are quoting, is that flights or revenue?
The higher revenue flights are not down by nearly as much as the less lucrative traffic.

[eglnyt]

And an alleged 13% pay rise for our glorious leader let's not forget.

You won't ever find me defending executive pay. I'm firmly in the camp that can't see how one individual can be worth so much whether they work for NATS or a bank or anywhere else. I'm also not convinced that the mutual arrangement whereby a group of executives from other companies get to set the rate in ours and vice versa actually sets a fair market rate for executive pay. I would however point out that it wasn't actually a pay rise. If you set somebody's pay set on performance and one year they don't hit that target and the next year they do the subsequent increase in pay isn't really a pay rise.

And an alleged £50 million dividend this year to the airlines

I have a slightly different view on that. The shareholders including me haven't had a fair rate of return in the good years. If a slightly higher dividend is paid this year it will redress that a bit especially as it's unlikely that one will be paid for the next couple of years.

BTW, the 10% reduction you are quoting, is that flights or revenue?
The higher revenue flights are not down by nearly as much as the less lucrative traffic.

The downturn is based on CSUs rather than traffic. It's a much better indicator of actual income in NERL than traffic as it takes into account the difference between lucrative and less lucrative traffic. You can find the figures on the Eurocontrol Charging site which Pelton Level posts links to from time to time.

[PeltonLevel]

BTW, the 10% reduction you are quoting, is that flights or revenue?
The higher revenue flights are not down by nearly as much as the less lucrative traffic.

The chargeable units for December and January are down 8.2% and 8.3% on the previous years - better than 10%, but not much, particularly when rates are set at RPI-x. There may have been some windfall gains on exchange rates in the latter part of 2008 but NATS hedges most of its route charges income.
(see EUROCONTROL - Service Units Forecast )
The latest predictions were due last week but still haven't been posted - don't expect too much cheer when they are issued.

[jonny B good]

Dividends

When we talk about invstors/shareholders not having had an adequate return on their investment, we need to remember that this return does not need to be in the form of dividends. An increase in the value of your shares is also a return, and one which can be reflected in the individual shareholders company accounts. I would say a return where ones share value has increased from approx £0.80 to £2.50 in 8yrs isn't so bad. That equates to the FTSE increasing by 300% over the same period. Not such a bad return really!

[eglnyt]

Be careful not to confuse the artificial price set to allow a pseudo trade in the employee share holding with the actual value of NATS or its shares.

Some of the airlines which form the Airline Group are not public companies so it's quite hard to see what value they put on their Airline Group shareholding and some don't put a figure in their Annual Reports. Those that do seemed to assume a value last year of about £10.5 million on an original investment of £6.6 million. Not bad but well down on the 300%. As FTSE shares have fallen about 30% since those reports it would be reasonable to assume some adjustment in NATS share valuation based on likely future income and dividend will be reflected in their 2008/2009 reports when they are published. Their shareholding value is probably just a little bit more than they paid for it but as there's no real market nobody knows for sure.

[xzulu]

Introduction of Mode S

In reply to ImnotanERIC's earlier post....

Can any one recall what happended when Mode S was first introduced into OPs. Was there a smooth transition? Was it well received by the Ops room?

[Radarspod]

Assuming you mean Mode S Tools in the ops room, it was extremely well received if I recall, although there had to be a new RDP build pretty much straight afterwards as some minor assumptions made in simulations weren't quite the same as reality when it came to the levels of Mode S equipage in the transponder population and some related indications - if I've got that wrong I'm sure an LTC bod will say so. No where near as bad as AMAN's introduction.

Meanwhile, back on thread..............

[anotherthing]

Xzulu

Mode S was very well received in the Ops room. There were some moans about some superfluous information causing excess clutter on the radar, and they got fixed immediately.

There will always be some moans when new kit etc is introduced - it's what comes naturally to an ATCO - the time ATCOs don't whinge when something new has been introduced is the time to sit up and worry.

The difference is the whinges about Mode S were done and dusted after about a week. Thereafter there were MORs put in because some airline operator were seen to be deviating from what was condered should have been the norm.

[kinglouis]

Pay anyone???

[FDP_Walla]

Pay. I hear that the Union bods walked out on Fri. There must be a union announcement soon.
Less than RPI is a cut in our conditions after accepting all the recent changes. That is of course last years RPI.

[Vote NO]

We should be getting 5.8% (Aug RPI+1%) minimum

If Nats are offering 0%, then I expect to meet them half way and get 3%, at the very least

[Radarspod]

If Nats are offering 0%, then I expect to meet them half way and get 3%, at the very least

Absolutely!

[055166k]

Communication

The union is well aware of deficiencies in its communication with the membership.....or so I was led to believe! I am concerned at the lack of touchy-feely union/membership chats to gauge the willingness or otherwise of the workforce to consider industrial action.......and exactly what level of offer would be needed to persuade worker opinion against a strike vote.
Bit too much going on in little secret rooms with no feedback for my liking!

[hold at SATAN]

If Nats are offering 0%, then I expect to meet them half way and get 3%, at the very least

RPI is historical data - i.e. prices have already gone up by that amount. Anything below RPI is a pay cut in real terms, so 3% is indeed a pay cut in real terms and thus should stick to no less than RPI - Aug08 or Sep08 figures, whichever we normally use - not latest

[anotherthing]

RPI is historical data - i.e. prices have already gone up by that amount. Anything below RPI is a pay cut in real terms, so 3% is indeed a pay cut in real terms and thus should stick to no less than RPI - Aug08 or Sep08 figures, whichever we normally use - not latest

Too right, in fact despite low inflation and an economic downturn, prices that we, the consumer are paying, continue to increase. Petrol prices have risen to around 10p a litre more than some 3 months ago, and food prices continue to go up...

...The most popular cuts of lamb, pork and beef are up by as much as 59% in a year, putting enormous pressure on household budgets...

Meat prices rise - report dated 2nd March 2009.

It's in the Mirror - it must be true!

A pay award of last Augusts RPI (a reflection of the year up to August 2008) would in effect be a standard of living freeze at best, and a standard of living cut in some opinion.

August 2009 RPI+1 is what we should be aiming to get - we should be claiming initially for higher to ensure we get it...

[rumouroid]

055166K

Couldn't agree with you more. O.K. so the reps walked out of the pay meeting last Friday, I'm pretty sure management consider that a good result, no negotiations mean no pay rise, which is exactly what they want.
It's time to up the ante and start talking about industrial action unless a sensible offer is made my a certain deadline, scaremongering and propaganda works both ways. In the Profile magazine other similiar Professional groups managed a 3-4% pay rise, so why can't we negotiate the same?
Please can the Prospect reps organise some question and answer sessions so that they can give and receive ideas on how their members should proceed to get this deal through soon, because the longer we wait the worse position we will be in.
The Jan 2009 pay deal is based on August 2008 RPI and NOTHING ELSE, it must be stressed that current traffic levels and RPI must not be used in the negotiations by management. The August 2009 RPI will probably be negative for the Jan 2010 pay talks and that is why it's SO important to ensure we don't come away with nothing now.