Royal Mail: Pension closure plan, yet another attack on working class pensions.

Workers will vote on taking industrial action over Royal Mail’s plan to end the current pension scheme.

Royal Mail says the current scheme is “too costly”.

 Mail workers are being treated as if they are a “cost”. Workers are not a “cost” but are wealth producers, adding value to the product at every stage. Pensions, like wages, are claims against the continuous new value they create.

New value is divided up. The claim of the working class, the reproduced-value, which reproduces workers and maintains their living conditions throughout life is one claim. This claim is obviously through their wages while at work and pensions when retired. Another claim is of those who own and control the economy, the added-value, which becomes equity and interest profit, and then there is the claim of the state, mainly through taxation.

Royal Mail’s plan to close its defined benefit pension scheme next year will be met with the “strongest possible opposition”, including a ballot for action, according to the Communication Workers Union (CWU).

The company want to end the scheme from March next year on “cost” grounds.

CWU object because a replacement scheme would result in its members facing “poverty” in retirement, losing up to a third of their current future pension value.

Acting CWU deputy general secretary, Ray Ellis, said:

“Although Royal Mail’s own consultation exercise revealed massive opposition to the closure plan, the company has decided to ignore the views of its workforce and proceed with closure without consent.”

He added: “We will not stand by and watch the company abandon the pension promises it made at the time of privatisation which threatens our members with massive cuts to their future pension benefits and insecurity and poverty in retirement.”

Unite said it could not rule out a ballot either.

Royal Mail said it has reviewed the results of a consultation feedback received from members and its unions, the CWU and Unite/CMA.

They state:

“This includes a proposal put forward by the CWU. Sustainability, affordability and security are the principles the Company employed when reviewing the consultation feedback”.

Royal Mail admit that the pension scheme is currently in surplus but speculate the surplus will run out in 2018. They offer no evidence about “sustainability”.The Company’s annual pension contributions are currently around £400m and this portion of the new value it creates from the product it wants to steal and add to its portion of the claim. The struggle is thus between the reproduced value and the profitable added value claimed by the company. They envisage new value increasing to the extent that the workers’ claim could go up to £1bn in 2bn. Either they are expecting even greater profits or they are exaggerating, but either way the argument that it is unaffordable is fraudulent.

Talk by the company about “security” is crocodile tears as only workers’ insecurity can be envisaged by reducing workers’ standards to poverty levels in retirement.

The decision to close the plan is therefore wrong even though it will be subject to Trustee approval.

The CWU accused Royal Mail of offering an “inferior” alternative, saying its own suggestion of a defined benefit Wage in Retirement scheme would have given it a “credible, cost efficient and last pension solution”.

Royal Mail workers when they vote know that the action theu may have to take is because they are fighting for the rights of all. Workers know that when they fight for pensions, it is for the entire class, as pensions are a right under attack from all sides, whatever scheme, including state pensions. Workers have a right to dignity while working and in old age. Workers today are fighting both for the pensions that all want and need, and to defend the pensions we have.

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