Unite to Vote on Royal Mail Pension Proposals

UK-based union Unite said it will hold a consultative ballot of its 6,000 Royal Mail managers on the latest pension proposals offered by the company’s management.

The Royal Mail said in a statement that it is offering members the choice of joining either a defined benefit cash balance plan, or a defined contribution plan. Royal Mail said it is one of few companies offering to replace one defined benefit plan with another. The balloting of members started this week, and will close on Aug. 7.

“We have had many discussions with the company over the last few months and these have been difficult,” said Brian Scott, Unite officer for the Royal Mail. “However, the Unite negotiating team considers that what is on offer is the best achievable in the circumstances.”

Despite Scott calling the offer the “best achievable” one, the union said that it would not make a recommendation to its members on the package.

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“We are committed to holding a membership consultative ballot on the Royal Mail’s latest proposals,” Scott said. “We are not making any recommendation. We think it is important that Unite members have an opportunity to express an opinion on what is being put forward by the company.”

Scott said that the latest position is an improvement from the original proposal.
“One of the main developments is that we will keep the defined benefit pension scheme open, and the lump sum approach being put forward will become a separate section of that scheme,” said Scott. “This will reduce any adverse impact on members’ future retirement incomes.”

Unite has about 6,000 members working for the Royal Mail, which became a privately owned company in 2013. In April, the 500-year-old postal service said it will close its defined benefit pension plan by the end of March 2018 due to diminishing funds.

Tags: ballot, DB, DC, Pension, Royal Mail

The International Monetary Fund (IMF) has downgraded its growth forecast for the US and the UK for 2017, while upgrading its forecast for the European Union, Canada, Japan, and China.

The IMF said it now expects US growth of 2.1% for 2017, down from its previous guidance, issued in April, that predicted growth of 2.3%. It also lowered its forecast for 2018 to 2.1% from 2.5%.

“While the markdown in the 2017 forecast reflects in part the weak growth outturn in the first quarter of the year,” said the IMF, “the major factor behind the growth revision, especially for 2018, is the assumption that fiscal policy will be less expansionary than previously assumed, given the uncertainty about the timing and nature of US fiscal policy changes.”

The IMF also downgraded its expectations for growth in the UK to 1.7% from 2.0%, but maintained its 2018 forecast at 1.5%.

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However, the US and UK downgrades were more the exception than the norm, as the IMF upgraded its 2017 growth projections for many EU countries, including France, Germany, Italy, and Spain, where Q1 growth generally exceeded expectations.

“This, together with positive growth revisions for the last quarter of 2016 and high-frequency indicators for the second quarter of 2017, indicate stronger momentum in domestic demand than previously anticipated,” said the IMF.

For the overall Euro Area, the IMF upgraded its growth forecast to 1.9% in 2017 and 1.7% in 2018, from 1.7% and 1.6%, respectively. For Germany, it raised its forecast to 1.8% in 2017 and 1.6% in 2018, from 1.6% and 1.5%, respectively, while France was upgraded to 1.5% and 1.7% in 2017 and 2018, up from 1.4% and 1.6%, respectively.

The IMF gave its biggest revisions in growth guidance among EU countries to Italy and Spain. The IMF raised its 2017 growth forecast for Italy to 1.3% from 0.8%, while upgrading its 2018 forecast to 1.0% from 0.8%. Meanwhile, the IMF upgraded Spain’s 2017 growth to 3.1% from 2.8%, and raised its 2018 guidance to 2.4% from 2.1%.

“The pickup in activity in the Euro area, with buoyant market sentiment and reduced political risks, could be stronger and more durable than currently projected,” said the IMF. “On the downside, protracted policy uncertainty or other shocks could trigger a correction in rich market valuations, especially for equities, and an increase in volatility from current very low levels.”

The growth forecast was also upgraded for Canada where “buoyant domestic demand” boosted first-quarter growth to 3.7%, and “indicators suggest resilient second-quarter activity.” While Canada saw the sharpest upgrade for 2017, as the IMF raised its forecast to 2.5% from 1.9%, it lowered its 2018 forecast by 0.1% to 1.9%. Forecasts were also raised slightly for Japan, “where private consumption, investment, and exports supported first-quarter growth,” said the IMF.

Meanwhile, the IMF slightly upgraded China’s growth for 2017 and 2018 to 6.7% and 6.4%, respectively, from 6.6% and 6.2%. The IMF left its 2017 and 2018 forecast for global growth unchanged at 3.5% and 3.6%, respectively.

Tags: downgrades, growth, IMF, UK, US