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CTC McAlpine cash bond...

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Old 8th May 2003, 00:29
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Question CTC McAlpine cash bond...

I am having a bit of difficulty in determining the exact nature of the financial commitment involved with the CTC McAlpine sponsorship scheme.

To simplify matters, I would be grateful if someone could answer the following query, or indeed offer any comments...

If a person was in the position of not needing to get a bank loan, how much money will he or she have to 'fork out' for the scheme and how much of that would be paid back to said individual eventually?

Same question goes for poor sod who needs to sell his or her soul to get funding from the 'high street bank' mentioned.

Please excuse me if my question has been answered already. I am experiencing frustrating problems with my internet connection. I can only maintain a connection for a short amount of time before it drops and it takes about 15 attempts to get dialled up again! At this rate it will take me 3 months to wade through the other CTC Mc Alpine threads

Thanks for your time,

Haul.
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Old 8th May 2003, 01:11
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hiya,
sorry to hear about your computer prediciment

the cash bond for CTC McAlpine is £60,000 - but its about £160 just to have you're application processed.

the £60,000 is paid off from your salary if you get a job with the airline, the £160 has to be paid out of your own pocket...

good luck in your career

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Old 8th May 2003, 01:19
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I had problems getting my head round it until I attended selection. Basically:

- they pay for all your training and extras (said to be £100,000 worth) and give you about £14,000 in allowances; you don't need to pay anything

- they eventually get their money from the airline

- until they get paid you are bonded to them for £60,000 to secure their expenditure

- they don't fancy chasing people who do a runner for the bond, so they get you to deposit it with them (over about 14 months)

- if you don't have the money, they have a bank who will loan you the money unsecured on favourable terms (fixed rate interest at quite a low rate, repayments not required until employed)

- when they get paid by the airline, they give you all your money back

- the bonding arrangement is employed by the airline as well; you'll be required to deposit £60,000 with them

- the airline pay off your bank loan (or you if you put up your own bond) over 7 years at the rate of £1,000 per month which means you get back £84,000 which covers the interest that the bank charge (if you borrowed from them)

- the pay you get from the airline is pretty competitive as a starting salary but less than an experienced pilot would get. The bond repayments are in addition to the basic salary and are not taxed

It seems to me to be very similar to the old BA cadet scheme except the bond is cash rather than just contractual. Certainly it seems a much better deal than most cadet schemes I've looked at which are only part-sponsorship as they require a sizeable payment for your own training.

I guess that's why they are backed by McAlpines who are a huge company and can afford to sponsor people on behalf of the airlines.
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Old 12th May 2003, 18:53
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Are you saying that you pay money to CTC mounting to £60k over 14 months, but you have to pay £60k to the Airline ASWELL? £60k+£60k=£120k total bond? And as you also said, you get £84k back from the airline over 7 years so total cost to applicant is £36k? Or is it that the £60k you pay to CTC is paid back as a separate sum?

PJ
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Old 12th May 2003, 21:00
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ctc bond

Think of it as CTC spending thousands on your training. The 60K is their insurance that you dont qualify and do a runner. The airline will then 'buy' the pilot from CTC at which stage CTC will have made their money, no longer requiring the 60K insurance so hand it over to the airline. The airline pays the pilot the 60K back out of their salary over 7 yrs, therefore if you leave the airline before 7yrs they keep whatever proportion of the bond remains.

I was a little sceptical at first but after much investigation it appears to be quite reasonable

Cheers CC
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Old 12th May 2003, 23:46
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Hi pilotpj

There’s only one £60K bond, not 2. Therefore you don’t pay anything for your training.

I’m pretty sure that the bond repayment is in addition rather than out of your salary, Captain Calm, and it’s not taxable as its just returning your money.

I guess the issue you are referring to is that cadets earn less than DEPs. However, that was discussed at the presentation I went to; all airlines pay roughly the going rate for different recruits, so DE Captains earn more than DEP SFOs, who earn more than DEP FOs, who earn more than cadets. So, comparing a cadet starting salary with a DEP starting salary is not a valid comparison. I’m not an expert on salary levels, but it seems to me that the JMC and easyJet cadet starting salaries are pretty much in-line with other airlines (e.g. BA), so the bond repayment is genuinely in addition to your salary.

As you said, it’s a bit different, so easy to be sceptical of, but upon close examination seems to be a pretty good deal
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Old 13th May 2003, 00:39
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Angry

TonyBlair,

easyJet and jmc have just about the worst terms and conditions in the industry for FO's.

You will earn about £20000 in your first year at jmc. The BALPA company council are not happy with this scheme from what I hear.

You will earn a reduced salary for SEVEN years...........

If this is the only way then go for it......but you will be p?ssed off in a few years when you have 4000 hours and are earning less than a new hire FO with 1500 hours. It will happen because things will pick up in the industry, and then all hell will break loose....but not for you because you are bonded for £60000!!!!!!!!!!! You won't be able to fart let alone leave.....

Nightmare.
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Old 13th May 2003, 02:27
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As Tailscrape says, it's the reduced salary for 7 years that causes the most 'eyebrow raising' amongst those of us already lucky enough to be employed.

When I joined jmc I went in as a direct entry F/O on the reduced salary level because I had a frozen ATPL. I had 900hrs TT and in 12 months I had unfrozen my licence and said thankyou very much for the £10k pay rise. Even people like Tailscrape (no offence mate!) who joined as cadet entry CTC guys would only take just over 2 years to unfreeze their licences from a strt point of 250hrs TT.

So you can see that 7 years on the reduced salary really is a detrimental step in terms and conditions of service, to the tune of roughly 5 years at approx. £10k a year, which is £50k. So you could argue that that is the cost of the scheme to you the individual.

Tailscrape is also correct in pointing out just how peeved you are going to be 2 or 3 years after getting the job and seeing others enter and move onto more money more quickly and also, especially for those based down south, how they can't afford to live there on the pittance that they are being paid. Life can move a long way in 7 years, just think about it and realise that the rose tinted spectacles will drop off the end of your nose at some point during those 7 years.

I guess you have got to do what you have got to do, but don't be moaning about terms and conditions for at least 7 years if you sign on the dotted line.

PP
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Old 13th May 2003, 06:52
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Good points PP and tailscrape. As I said, I don’t know enough about JMC and easyJet’s salaries to compare, although looking at the IPA data they seem not to be terrible – there are plenty of others that pay worse. However, looking from here (although I didn’t get selected), it seems slightly different, for these reasons –

1 Someone doing this scheme does not pay for their own training, whereas the direct entrant with 1500 hours presumably has done. Let’s say that direct entrant did the Jerez Integrated course and borrowed the money by re-mortgaging their parent’s house (I wish). Cost of course £63K, living costs £5K, contingency fund & niff-naff (extra training/exam fees/life and loss of licence insurance to cover the loan, etc) £7K total £75K. Cost of repayment of £75K over 7 years = approx £1,200 per month out of net salary. Gross that up, (say allow 35% to cover tax and NI) and the DEP has to dedicate over £22K of his salary pa to pay that loan. Wow. My figures may not be exact, you might argue doing a cheapo licence course, but it’s still a huge problem to pay off that will drain the salary for years and makes the cadet salary seem positively generous.
2 How do you get from 200 to 1,500 hours to get the job? Look around PPRuNe to see the problem that poses for the vast majority, including your own story PP. How are you going to service that debt while unemployed or working for a pittance while in the no-man’s-land?
3 How do you know when you are starting out alone that there is going to be a job at the end of it all and you are not going to be marooned in no-man’s-land like many unfortunate PPRuNers, STILL with that horrendous debt to service?

I still say it’s an excellent deal – 100% sponsorship & a near guarantee of a job with a major airline when the training is over. I’ve met a few BA cadets now flying with the airline, and I’ve never met one who thinks he or she had a bad deal, despite being on a cadet salary for years. I expect the same will be true of those who were more successful in the CTC McAlpine selection than I was; good luck to them I say - they are a privileged few.
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Old 13th May 2003, 23:06
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PP,

You always say what I mean, but in a more diplomatic way! Cheers!

TonyBlair,

I do not knock you, but you must look beyond the initial elation of getting a job. When you talk about terms and conditions, you must think long term. Think of:

Payscales. You will be a reduced earner for SEVEN years upon joining. That is NINE years if you think about your training period. Then if you are unlucky enough to fail a command, or the industry contracts again you may be stuck on some of the lowest RHS wages in the industry at jmc and easyJet. The top scale after 15 years at jmc is only about £50000 for an SFO, whereas at Britannia it is somewhere in the lowish £6o k mark. At easyJet they do not even have incremental scales! You are on £36000 a year as an SFO regardless of length of service. Yes, u may get a bonus at easyJet. However they have to profitable I think to earn it (?).

Pension: At jmc two years ago we had a respectable FINAL SALARY pension. Now it is closed to new joiners. A new defined benefit scheme is to be offered to new joiners. However the pilot community may still resist this move to safeguard their collective futures.

Medical and Health: Will companies still offer this in the future? A lot do not already. jmc do....I have no idea if easyJet do.

Holidays: How much etc....and more importantly can you get it when you need it?

Staff travel: Is it worth anything?

I could go on and on............ just think of the big picture before you sign a contract. You WILL be naffed off when you have SIX and a HALF years on type and people 150 or 200 places below you are earning more because time and circumstances were on their side.

Management will not change your contract to a full one until you have paid your dues once you sign..........you may think they will, but they won't.
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Old 14th May 2003, 07:11
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Tony

I see where you are coming from,but when I trained most self improvers that I came across were either career changers like myslef who had some money due to 10+ years of working or house owners who realised equity in their properties.

However, many did get into debt as they had no other means and are still paying back their debts now, together with trying to get a car loan for a decent car to get them to work and back reliably, a mortgage to get a home to live in etc etc.

What you need to keep in mind however is the real Big Picture, which Tailscrape so eruditely alludes to; Think of terms and conditions 10 years from now, and see if the whole industry hasn't been eroded by such 'options', usually by way of 'pulling the ladder up'; ie new joiners end up on ever decreasing terms and conditions as a way of reducing costs.

We are not saying don't do it, but just be very aware of the consequences, which I know is easy for me to say sitting in the RHS of a 767.............................

I wish you all luck,

PP
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Old 14th May 2003, 17:54
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Angel

I did have a whole speech typed out for this, but changed my mind, as I don't want to get involved. I have recently been successful with CTC.

My Summary: Very nice people, excellent training facilities, a unique course to give airlines exactly what they want from cadets and as close to a guaranatee of a jet job as one can get in today's market.

Not going to say which course I am on, as that would give the game away, but good luck to all that apply.

Here's to NZ and a wonderful career.

PA
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Old 15th May 2003, 04:21
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Pete,

Not a bad reply given yesterday evenings consumption of beer and red wine.
Speak to you anon mate.
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Old 15th May 2003, 19:16
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Thanks for the replies folks...

I must admit that I had the same concerns as tailscrape and Pilot Pete when I did the math. I don't fancy the idea of being 34 and only earning 15-20K per year!

Not quite sure as to what options I have, but the way I see it at the moment I would be getting into 60K worth of debt with the CTC scheme with no guarantee that I would have a job at the end of it to allow me to pay the debt off!

If I fund my own CPL/IR I will only need to find about 30K (excluding a type rating) doing modular?

I notice that CTC McAlpine are using Bristol Ground School to get the cadets through the theory, so why does it cost over 100K (according to them) to complete the cadets training?

I tend to consider the worst case scenario, i.e. you do the training and don't get placed with an airline, or you DO get placed but then easyJet go under in 3 years time I don't think any other airline would want to take on your debt repayments.

So what should a person with an fATPL and about 300 hours (but no backing from a company such as CTC McAlpine) do to try and gain employment ideally?

Again, thanks folks for taking the time to reply to my post

Haul.
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Old 16th May 2003, 23:17
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I am 18 and about to finish my A levels, and when I heard about the CTCMcAlpine scheme it seemed like a dream come true! And still now, I would give anything to get on that scheme when my A levels are done, but then I'm looking realistically...

Anyway, about the low salaries, I know 20K a year is low for an airline pilot, but come on it isn't a 'pittance' generally. You can still have a fairly good standard of living (20k is about the average where I live) on that money, foreign holidays, cars etc.... (as long as your sensible). Then again, I live in Coventry, so cost of living is much lower than down south. The point i'm trying to make is that I would be quite happy to accept the terms of the scheme, and do intend to apply. It was mentioned above that in the 7 years the individual could loose around 50K in earnings. But bare in mind, at the end of the day, jmc or easyJet have splashed out (or will have at the end of the 7 years) £84,000. So your still 30K "up".

Another interesting point is the marketing of this scheme. I would have thought the scheme does not need to be marketed much at all, as anyone interested in piloting will (or should by now) know about its existance. Yet the other week, in my 6th form centre, a poster (from CTCMcAlpine) was put up, with a piccy of a 747 taking off into the sunset, and "can you make the grade. sponsered pilot training from ctcmcalpine. visit ctcmcalpine.co.uk"
Now my 6th form is your average 6th form at a comprehensive on the outskirts of a city. So if my school got a mail drop from them, then how many others have? interesting indeed.

jmc757
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Old 18th May 2003, 00:03
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very interesting thread to read!
I have a further question to put to the test. What happens if the cadet who has trained with CTC, attained a position, comes into some money? Can you pay off the bond before the seven years has passed. If so then surely if you are accepted on the scheme, pass and get a job, then remortgage you must be saving money. I come to the conclusion that if you train yourself it will cost between 60-80K (uk based??) and to get the money a person could simply take out a loan etc for this much. It therefore seems cheaper to try for the scheme and then take the loans only for only 60K!!(therefore guarenteeing a good training at a definite 60K). I also ask that if the answer is yes you can pay off the bond, can you then switch companies when the industry picks up?

Anyway, back to work, have a lovely day fellow ppruners!!
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Old 18th May 2003, 00:18
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The way it works if you take the 60k finance from their financier: At the end of training, if its all gone to plan, you work for the sponsoring airline who pay you your cadet entry salary, and on top of that they pay you an extra £1000 per month, this £1000 per month is there to pay back the 60k finance you took from their finance partner for the bond. So you personally owe the bank back the 60k (around 84k with interest) which they expect back at the rate of 1000 per month. the sponsoring airlines 1000 per month covers the full 84k over 7 years. you can pay the bank back the money early at no penalty, but the sponsoring airline will still only give it back to you at the rate of 1000 per month up to the full 84k. Ive almost confused myself there, but hope it helps!

ps, if you leave the sponsoring airline early, you forfeit the money remaining in the bond that they owe you ( the 84k) but you are still liable for the repayments to the bank.

Last edited by FREDA; 18th May 2003 at 00:43.
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Old 28th May 2003, 18:12
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Hi All,

I have just 1 quick question which is related to the CTC scheme (if not this trhread directly then I apologise for hi-jacking).

Is it normal practise to receive no email of confirmation of reciept of application from easyJet after applying online. I applied about 3 months ago and have heard nothing from them. I'd have thought it would have been easy for them to send an automated email once you submitted your application.

Anyone else found this or has my application been lost in CyberSpace?
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Old 2nd Jun 2003, 21:10
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Schooner,

I was under the impresion that replys are generally pretty quick, mine was three or four days.

Having said that I do not know their policy on unsuccessful applications, maybe you should check this, if you were successful you probably would know by now.

regards

Chopper
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Old 5th Jun 2003, 06:10
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Guys, there is another thread dealing with the nuts and bolts of the CTC-McAlpine selection procedure; please don't divert this one, which has wider and more far-reaching implications.

As Pete and tailscrape have suggested, there are downsides to this scheme, one of the worst of which is that you could be overtaken in earnings by those who come after you if a more competetive pilot market develops in your bonded years. However, you have to play the hand you're dealt. If you get in on this scheme, and you work hard enough to succeed, you will find yourself employed in an airliner at a time when most wannabes will not. Many, if not most, of those considering this course will not have the luxury of time to wait and see what transpires in the overall market, so they must decide either to give it a go or to pay the whole lot themselves in the hope that things will improve quickly. I don't have that kind of money, or faith, after 27 years in this business; I know which option I'd take! Mind you, I'd make sure I was in a position, once employed, to let the airline know exactly what I thought of any scheme that disadvantaged me and my peers as the airline had to work harder to get pilots - and Balpa and/or the IPA would be right behind me!

You can't fight for the conditions you would like if you're not in the business. This scheme offers the best - and fairest - chance of getting into the airlines currently on offer, though that will undoubtedly change as time goes on.

Incidentally, I find the talk of £20k on appointment under this scheme at JMC somewhat alarming; is it true? I believe that at easyJet it's considerably higher. I have no problem with an apprentice/journeyman at this or any trade being paid less - even considerably less - than an experienced artisan, but £20k seems unnecessarily parsimonious!

Scroggs
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