The cap is just a red herring:

From the NATS forum:

the modeller on NATSNET DOES take the future value of the £117,600 cap into account in so far as it IGNORES RPI in it's calculations, therefore the increase in the cap is irrelevant. The reason why pre and post new pensions figures are the same is that you will be capped by the RPI+0.5 limit until you hit the £117,600 rate( at today's prices), which is when your pensionable earnings STOP DEAD and the 0.5% becomes irrelevant.

If you imagine, the most you can earn which will be pensionable is £117,600 in todays money. in about 30 years it will be worth about 300k at the prices at that time

Imagine a race with 2 runners A and B:

A is the NATS imposed pensionable pay cap, currently £117,600
B is your pay

A's running speed is RPI
B's running speed is whatever RPI+x% rate we will get per annum

Provided your pay (B) increases by a value greater than RPI, B will catch up proportionatle to the difference. i.e, if B was running at RPI+2% it will catch up much quicker that RPI+1%.

The curve ball is that B can never overtake A, so when B eventually catches up, it will have to keep pace with A - in effect the Cap on pensionable earnings becomes RPI (NOT RPI+0.5% those NATS snakes are proposing (?))


The modeller simply tracks the differences between the two runners and NOT how far thay have run :{ . Your future pensionable pay will never exceed the £117,600 cap (at today's prices).

At a Band 5 unit, an ATCO 2 can expect to hit the cap in about 26 years time if pay increases at 1% above RPI; 17 years if 1.5% above RPI. So if the Bar stewards that run NATS get their way, for the next 15years pensionable pay will be limited by RPI+0.5%; a few years later salary will hit the cap and then pensionable pay will simply increase by RPI ONLY, even if NATS (or whatever we'll be renamed) decide to lift the RPI+0.5% limit
Remember the £117,600 cap was a rule that was subsequently repealed by the government which NATS elected to retain. See pensions notice 01/2006, item 11

Does anyone honestly believe we can expect annual pay rises of RPI+1.5% or RPI+2%?

Thanks Caesartheboogeyman, for bringing that amusing post in NATSNET up

"day one of the cycle and the fun starts already
anyone read natsnet today? interesting read.
mr barrons bonus is not in any way linked to the pension deal going through. it is only linked to service provision and the future health of the company".

For a CEO to reply personally to a "wind up" post about an Aston Martin in such a manner means he is well and truly rattled :}. Staff 1 - 0 Management :D
He made a mistake here by rising to the bait. This means he knows he has a fight on his hands..........:E

Gonzo, even RPI+0.5% means that your good self will hit the buffers in 26years time... and if you hit the heady heights of SATCO, then sooner still. :ok:

Furthermore although inflation is currently at 5.2% (driven mostly by fuel costs), most city boffins reckon next year infltion will struggle to exceed 2%, so we won't be getting any psychologically large rise (e.g 5.2%-current inflation)

How's this for fun.... we keep on posting on NATSNET and comment on is DB9 or his bonus. FIGHT! FIGHT! FIGHT! :ouch:

and please CTC, enough with the "rusty chains" already :\

"Furthermore although inflation is currently at 5.2% (driven mostly by fuel costs), most city boffins reckon next year infltion will struggle to exceed 2%, so we won't be getting any psychologically large rise (e.g 5.2%-current inflation)"


This time next year inflation could be 0% or -1% (deflation)

Not my guess, but that of several economists. "If we are very lucky, all we will get is a very nasty recession" Failing that if USA hits depression..........:eek:

if RPI becomes minus1%, will the pension cap proposd be minus0.5% (i.e RPI+0.5%)?

Damn you Barron, damn you! :suspect:

"CPI will go viciously negative – it's looking increasingly likely that it drops below target. It could easily go into negative territory, along with RPI."
The Retail Price Index – the most comprehensive measure of UK high street prices, will drop at an almost unprecedented rate to
-2pc by the second half of next year, according to new research from Fathom Consulting.
If oil prices came back below $70 a barrel (it is now..Opec on Thursday brought forward to next week an emergency meeting to consider a cut in production after oil prices dropped to less than $70 a barrel for the first time in more than a year on worries about a global recession) and house prices fall at an even faster rate,the level of RPI inflation could fall as low as -3pc and remain in negative territory for a year.

Nats have to go for this pension deal now, I suspect they wish they had gone earlier .

Britain faces deflation for first time since 1960 - Telegraph

Any pension cap will not be negative. It is not posible to reduce your pension due to the trust deed and rules (no decrement clause), i.e. it cannot be less tommorrow than it is today.

Just what is RPI??
 

With regards to the proposed changes to the pension and the possible capping of pensionable pay to RPI+0.5%, what do you understand by the term RPI?

You might believe that RPI is the figure issued by the Government/Banks to indicate the rate of inflation. However, according to a colleague who very recently attended a pension briefing and asked the question, the RPI that will be used for the purposes of pension capping will be an arbitrary figure, set by the Actuaries.

Do you trust the company and its accountants enough to believe that the RPI will be a fair one, indicative of the financial climate?

This is a question that is worth exploring further at any briefings you might attend.

The RPI figure used by NATS for the last 2 pay rises in Jan 07 and 08 was the official RPI figure from the previous August as agreed in the pay deal.

I am sure the RPI that would be used if the deal is sanctioned would be the "official" figure that is used currently by CAAPS to increase current pensions.

In the glossy brochure, it does state "the Retail Prices Index" so I guess they will have to use the figure published by the government.

The actuary uses a long term assumption that the rpi will be an average of x.
It is not this rpi which is used in pay negoitiations, which is currently the August RPI figure for the year concerned. Over time, the actuary assumes that the level accross each year will eventually be the long term average assumption.

The whole point is nobody knows how RPI is going to behave over,say, 25 years or what, if any, payrises we get above RPI. Therefore the modeller is a total waste of time as there are too many variables involved that cannot be accounted for. How on earth can you vote YES on something this big when you don't know how much exactly you stand to lose???

VOTE NO NO NO.

The only variable that matters in the model is the size of the pay rise you get in the future. Since the proposed cap is above rpi, any rpi figure doesn't matter as you can still get above it. The only uncertainty is the level of pay rise you think you will get year after year.
You are right, no-one knows what this might be. That is the point of the modeller. Put in what you honestly think pay rises will be for the next 15yrs and the model will show you the difference if you actually achieved those rises.

NATS and the NTUS are asking us to vote yes on an agreement by way of a Memorandum of Understanding, whose words we cannot see. They ask us to 'trust them' that the document will take care of things.

Would you sign or agree any other legal document without having seen the full text and satisfying yourself that it protects your interests ?

I think not. So regardless of whether I think the proposal is a good one or not, I'd have to vote NO to prevent me potentially being stitched up by people who have my best interests at heart ... allegedely.

Am I right in thinking that this fabled memorandum of Understanding is NOT a legally binding agreement/document? If so, then its more NO from me. Honestly, there are so many reasons why this proposal just has to be voted a NO:ok:

more gems of joy on natsnet today.it seems mister barron commenting on the thtread on there has shown to us all in his roundabout way of answering questions that he does indeed have some sort of bonus possibly linked with this pension deal.
we have rattled him and you only have to read a few of the posts on there to see how we are willing to voice at work how pissed off we are and how important this is. i also hear that the chap who made the posts that got his attention got spoken to today by management from his watch about it and they were not overly impressed. his watch manager has already emailed barron to apologise on his behalf without asking him.... thats just taking the piss. Its provided us with some chuckles anyway.
bring it on barron.

Just left work and it seems the claim about Mr Barron, plus his personal rebuttal, have been removed from NATS Net. Maybe they used the same guy that removed the stuff from NATS website claiming the company were experts in moving pensions and working with unions. :ugh:

Hope he told them where to go ... t***ers.

someone struck a nerve and it was swiftly removed... no surprise there then.
after speaking with him this morning, he had asked for the apology that was sent to barron by his watch manager without him being asked to be retracted. he also stated that he would be happy to discuss it further with said watch manager and/or barron at a mutually convenient time.... with his local union rep present of course.
keep up the fight and lets get it out there that we are willing to push buttons and force the issue if required.

The rebuttal is still on NATSnet. He claims that his bonus is not linked to the pension scheme. Probably true in the literal sense but not as it relates to maximising profits/saleability.