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Author Topic: Company Pension  (Read 43635 times)

The Mrs

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Company Pension
« on: 11-02-06, 12:10AM »
As this is a topic that concerns both Stores and DC's I've brought the topics, already opened, together here into All Depts and copied the posts over.
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F R O N T -2-4-2-
Tesco has seen hundreds of millions of pounds wiped off the balance sheet due to the treatment of employee benefits under IFRS.

Net assets fell by £400m, mainly due to a £735m hit in accounting for its pension deficit

this has been kept quiet we had the pension women around at our store trying to get people to sign up, she never mentioned their was 735 million deficit even when asked, she said tescos is the most healthy pension anyone can have.
any one got any ideas to what scam they gonna pull to get the 735 back?
next year it will be more than 735 million.
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The Mrs
This wasn't kept quiet, it was widely published in May 2005. The article reads the same everywhere : http://www.accountancyage.com/accountancyage/news/2135615/tesco-shows-big-pension-deficit

The first line actually says "IFRS brings Tesco's pensions deficit onto the balance sheet, but overall effect is minimal".

This isn't anything of Tesco's doing. It's just a new way of reporting balance sheet items. To understand IFRS you first need to understand FRS 17 :
http://www.barnett-waddingham.co.uk/cms/services/actuarial/accounting/news01023/viewDocument

Then look at IFRS:
http://www.apinfo.co.uk/ipfa/articles/accounting_for_pension_costs.htm

It's no wonder your pension lady never mentioned it ... if she had told you all of the above information how many people would actually understand it?

I'd still recommend joining the Tesco pension scheme to everyone, as would every finanacial advisor I've spoken to.
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fatty
AHHH, after spending the last four hours i see what you mean! So we are ok then!Im happy to see that TESCO put an EXTRA 200 million into the pension fund last year.
From my understanding tesco is still regarded as one of the best retail pension funds. As i only came to work for tesco for a few months SIX YEARS AGO, im glad to hear it!
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Living the values
My main concern about Tesco's pension scheme is that only 1% of it is invested in cash, the rest is invested in shares, property and bonds. There's only so much longer property can continue to rise, and while shares can give a good return, i'd like a bit more of our pension money invested in cash which may give less return but is less risky in the long term.
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Brownfish
My concern is that when pension schemes say they have invested in property it sometimes means that it has pushed funds back into the host company to pay for developments. The store you work in may be funded by the pension scheme rather than the main business. It's OK aslong as the ownership is clear - not that Tesco is about to go belly up.
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fatty
So what would you all invest in? You all can take part by standing to be involved in the pension fund, leaflets are in your store now.
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The Mrs
Cash investments are only any good in the short term. Read this:

http://www.pathtoinvesting.org/categories/choosinginvestments/cash/cash_071.htm

You CANNOT make a pension scheme work with cash investments.
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jfp
Financial advisors always reccommend company pension schemes because of all the benefits tied in with it. e.g. death in service.
The statement "our scheme is one of the best" ranks alonside "your cheque is in the post"
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spirit
Bearing in mind that Tesco made 2 billion pounds profit last year and could if necessary plug any shortfall with a single hit.
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F R O N T -2-4-2-
SPIRIT do you think the shareholders who want a return on their investments will be happy for tescos to blow their cash on pensions?

the tesco pension bill is going up the profits will not stay a record levels forever they will level out but the pensions are increasing to fast to keep up.
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Never Mind
OK, so it's not perfect, but does anyone know of a better pension scheme out of the Civil Service?
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Living the values
The issues not if there are any better pension schemes out there or not, the bigger issue is how much longer are company pension schemes maintanable, especially as the population gets older, and as companies get ever more efficient will need less staff as years go on, meaining less employees to pay in to pension pot
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F R O N T -2-4-2-
does anyone remeber the letters a few years ago about getting less in your pension when you retire because the equitable life fiasco?
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Sanmay
Being nearer to retirement than most of you, all this interests me greatly.

My understanding of the Equitable Life 'fiasco' which patently wasn't our firm's fault, is that it only applied to parttimers who had money purchase schemes. I was one of them and I honestly don't seem to have come out of it too badly. They took their time thinking it through and now all the money put into that scheme has been transferred to the new scheme. This, apparently could not have been done before with the old pension scheme.

Dozens of firms have now finished the final salary schemes they were running, some for all employees, some for newly appointed employees. Tesco seem to have chosen the middle path. In its favour the new scheme is the same for part timers and full timers and all monies are transferable I believe so if you swop from part to full time and vice versa you don't lose out.

I don't think that the firm are on their own having pension problems. People are living longer, it costs more to live now when you're retired especially since darlin' Maggie changed the state pension from earnings related to inflation related.

I don't pretend to understand it all properly. I just know that I can't afford to retire yet with all the utility and council tax bills going up, the outs are bigger than the ins.
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F R O N T -2-4-2-
I see what you’re saying about the fiasco with Equitable Life,
However I can’t see how you came off better...
I for one received in my letter from tescos that on the date of my retirement I would be getting less than previous stated because of financial irregularities on behalf of Equitable Life.

No matter whose fault it is tescos put my pension money into a bad gamble and it has a direct negative result financially for me.

So if tescos can make a mess once who’s to say they will not do it again?
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Sanmay
I didn't say I came off better, I said I didn't come off too badly. Under the old scheme I would have had a little part time pension and a slightly larger full time pension. Now they are all rolled into one, which although not fantabulous is better than it could have been.

Lots of people lost all of their pension money, so I guess we should be thankful for small mercies. When you play the stock market it's always a gamble and absolutely nobody, not just Tesco's, knew that Equitable Life had overextended themselves and promised too much.

At the end of the day 242, could you have done better if you had chosen to go with a private pension. Who's to say you would not have chosen Equitable Life to invest your fund in. There are no gold plated guarantees that say we are all going to retire with pots of money and no worries.... I wish there were I really do
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fatty
So how can we safegaurd our future? Well as i have nearly 30 years to work before i retire i have made a decision to learn as much as i can about pensions. I will increase my AVCs and try to keep upto date with current leglislation, failing that i will ASK THE MRS, as the websites she mentioned worked out very usefull.
How many of us understand about pensions? Do we realise that we are investing in the stockmarket 10, 20, 30, 40, years in advance! When i look at my parents pensions im worried and so should we all be, we have more information than they had, so use it and be carefull. Take part, and regulate our company scheme, look after yourself for the future.
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F R O N T -2-4-2-
2 Points i would like to ask if you leave tescos you cn transfere your penion ....but how much of it?
why can you not transfere into tescos ?
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Sanmay
Don't quote me on this 242, but I believe you can transfer the present pension scheme to another firm if you leave. I'm not sure about transferring in. This apparently was supposed to be the clever part of the new scheme, the old one was neither transferrable to or from. Mind you I suppose it also depends on the scheme you are transferring to.

Fatty, AVCs are a good thing for someone your age I think, as long as they are not free-standing AVCs. The firm used to equal and add to any AVCs you paid in at one time, not sure now. Weren't they asking for members of staff to be trustees of the pension scheme at one time. That would be a good thing to be. I remember him indoors being one at his old firm, he learned an awful lot about pensions in the process, courses were attended etc etc
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champs
I'm a bit concerned at the moment about the national craze of big companies getting rid of their end off salary pensions.
I am sure that Tosco’s as a successful company would not even conceder this but if they did I am sure we would unite to show them that they were making a mistake.......
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The Guvnor
I too have the same concerns. I would no doubt agree that if the pension scheme were to be done away with then we may have the pleasure of know before the city got wind of any major changes to the scheme.
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nesbitt
ask youre union reps guys---pensions have been on the menu all last year,they are being looked at!!!!
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TONKA
They already have made some changes to the pension.Did you all have a letter early last year about the final salary and the new smart pension??.
How many answered the letter and wrote back saying that they did not want to change, because if you did not reply you aint on the final salary anymore.
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bushido
Funnily enough Tonka, in the briefing it said that you could have a pensions expert in from Head Office to explain it all, which I and another Union rep requested.... no one showed up so we all opted out of pension builder and stayed on final salary
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fatty
From what i read in the papers our fund is about £600 million short. Last year tescos put in an extra £200 million and i hope they at least do the same this year!
Im to young to think about pensions, im only 21 years old plus tax!
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shafted
at last, a topic that no matter what union you are in and even if you are a scabby non member this is going to affect all tesco people and one we should ALL fight together.so if you are a non member join today cos "unity is strength".
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The Mrs

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Re: Company Pension
« Reply #1 on: 11-02-06, 12:16AM »
Have you all received "Your Tesco pension - in the bag"?

Contribution increase of 1%.

I'm not surprised. But at least it's staying. According to Tesco's financial statements it needs to increase contributions for 10 years to cover it's acturial shortfall.

Tonka ... I couldn't remember receiving a letter last year, definately didn't reply to one, so I checked by ringing the pension helpline ... and Tuggie is still in the Final Salary scheme.



The Mrs (Administrator)

The Hurricane

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Re: Company Pension
« Reply #2 on: 11-02-06, 02:36AM »
Having consulted a financial advisor recently, I asked them to look over my Tesco Company Pension. The advisor was genuinly impressed with the pension scheme as it currently stands for full time staff (not sure how it duffers for part timers). I would not consider moving my pension, unless I left the company!

HE WHO DARES DOESN'T ALWAYS WIN, BUT THEY ALWAYS GET THE BOOBY PRIZE!

hotlips

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Re: Company Pension
« Reply #3 on: 06-07-06, 02:44AM »
Am very pleased with my pension and would never have considered joining the scheme that Morrisons ran but jumped at the chance to join up to tesco pension. Can't be beaten I think (unless someone out there knows different of course)




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Little Tinker

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Re: Company Pension
« Reply #4 on: 07-07-06, 05:34AM »
As long as theres money in the account in 20 years when i finish, il be a happy bunny  ;D ;D

Heaven never forsake's those who try !!!!!!



jester

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Re: Company Pension
« Reply #5 on: 10-09-06, 12:56PM »
I was quite fortunate to have started my pension in my teenage years, so it is going quite nicely as we speak.

zorro

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Re: Company Pension
« Reply #6 on: 10-09-06, 07:42PM »
As the hurricane said i also seen a finical adviser and he told me to stick with that pension,because it is probably the best one out there.

jester

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Re: Company Pension
« Reply #7 on: 22-12-06, 03:12AM »
Well, since I have moved jobs, I am expecting a letter about my pension, not sure if they will freeze it or what, anyone help here?

I am not a number! I am a free man!

Sanmay

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Re: Company Pension
« Reply #8 on: 22-12-06, 03:50AM »
Why not give them a ring SJ  ...try the helpline 01992647810.

Mon-Fri 8am-8pm...Sats 8am-1pm:)

Sanmay (Moderator)

I'm laughin, I'm laughin

jester

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Re: Company Pension
« Reply #9 on: 22-12-06, 10:46PM »
Thank you Sanmay, I will, watch this space...

I am not a number! I am a free man!

jester

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Re: Company Pension
« Reply #10 on: 23-12-06, 06:36PM »
My mother told me what I needed to know in the end. I tried to ring the phone number within the times stated, and got this response:
"Hello, we are unable to take your call, and you are unable to leave a message, please call back tomorrow" click, beeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeep.
How helpful.

I am not a number! I am a free man!

jester

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Re: Company Pension
« Reply #11 on: 01-02-07, 02:48PM »
Got a letter about my pension the other day, I chose to leave it where it was for the time being. Second time though I have been sent a letter requesting a response, but got no prepaid envelope inwhich to do so...

Ketchup does not hide pepper...

beefy

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Re: Company Pension
« Reply #12 on: 28-02-07, 04:31PM »
i think anyone who joined before 2001 is on final salary pension which is protected by law.anyone who joined after that date is still protected by law now,but isnt as financially rewarding.inflation,success etc. final salary i thought was that they take an average wage of your last 2 years service.the new one is they double your contribution which goes into a pot.i assume they dip in and top up each year as the business requires.this is what im led to believe,if anyone knows more please share.

HinckleyWorker

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Re: Company Pension
« Reply #13 on: 06-11-08, 07:38PM »
Are there not some situations where Tesco double matching your contribution is better than final salary? ie I put in £88 but get tax relief so I only pay about £60 net, so for my £60 I am getting £264 into my pot each month.


fatty

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Re: Company Pension
« Reply #14 on: 08-12-08, 11:57PM »
The pension fund is now as im sure you are aware undergoing its three yearly review. I wonder how it is faring in this economic climate?
I owe my success to having listened respectfully to the very best advice, and then going away and doing the exact opposite.
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The Mrs

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Re: Company Pension
« Reply #15 on: 17-02-09, 03:23PM »
Letters are out.  They are proposing a 1% increase in employee contributions spread over two years, .5% from April 2009 and .5% from April 2010.

toshbosh

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Re: Company Pension
« Reply #16 on: 23-02-09, 10:20AM »
here s a thought for everyone If tescot has 250 000 UK based staff each paying into the pension scheme and tescot keep making DC tescot staff redundant replacing them with agency staff who are not based in the UK, they are not paying into the staff pension scheme then there's going to be a short fall, and who is going to make up the difference, it's going to be the staff that are left working for tescot. So in a short period of time our contributions are going to increase to about 10% just to make up the shortfall  (?)) (?))

fatty

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Re: Company Pension
« Reply #17 on: 23-02-09, 07:02PM »
Of course they also will get less of a pension as they no longer work for the company :'( :p:
I owe my success to having listened respectfully to the very best advice, and then going away and doing the exact opposite.
G. K. Chesterton (1874 - 1936)

TOSer

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Re: Company Pension
« Reply #18 on: 23-02-09, 10:24PM »
So in the letter it said they want the employee contribution to go from 4.75% to 5%
and the Tesco contribution will go to 11.1%. 

What is that up from then? if it 0.25% and not 0.1% I would be surprised, do they
think people are stupid and that they wont notice they haven't said what the increase for
them will be.


Nomad

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Re: Company Pension
« Reply #19 on: 05-04-09, 12:52PM »
http://freshneasybuzz.blogspot.com/2009/04/on-heels-of-global-retailers-fiscal.html

Quote
J. P. Morgan said it believes Tesco's debt will exceed its targeted amount of £8 billion (pounds). The global retailer also has a current corporate pension fund deficit of £838 million (pounds). In its note, the investment bank says it believes the pension fund deficit has soared to £2 billion (pounds).
Nomad ( Forum Admin )
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tracy151

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Re: Company Pension
« Reply #20 on: 16-04-09, 12:01PM »
my husband being paying his pension for 30yrs uniq, he just been told not much money left in pension. he also paid to have another pension from work to top it up. which has been frozen

The Mrs

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Re: Company Pension
« Reply #21 on: 21-04-09, 09:54PM »
As at February 2009, under the IAS 19 methodology of pension liability valuation, the scheme had a deficit on a post-tax basis of £1.1bn (last year £0.6bn).

Tesco Press Release

The Mrs

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Re: Company Pension
« Reply #22 on: 22-04-09, 11:32PM »
TESCO has told 26,000 former staff to expect an annual pension rise of just 0.1 per cent this year — despite record £3BILLION profits.
A letter seen by Sun City reveals the increase was slashed to reflect a “considerable” slowdown in inflation.

The store giant, famous for its Every Little Helps slogan, uses the Retail Price Index as the basis for calculations. And it insists staff are not being short-changed.

Pensions administration manager Judith Murray said the rise had averaged nearly 3 per cent over the past five years. Last year’s was 4.1 per cent.

But her letter explained: “As you may be aware inflation has been slowing down considerably — and so your increase is lower than in previous years.” Other firms are almost certain to be under the same pressure to act.

Union officials said Tesco would be constrained by the £275million deficit in the pension scheme. But the letter arrived on pensioners’ doormats just days before yesterday’s bumper results were announced.


One ex-employee said: “It’s a joke.” Tesco profits were up 10 per cent to £3.1billion in the year to March on a 15 per cent sales jump to £59billion.


The Sun, 22/04/09

I assume the "union officials" are USDAW. Whoever it is, they are quoting deficit figures of two years ago.  8-)

The Mrs

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Re: Company Pension
« Reply #23 on: 04-06-09, 11:55PM »
Barclays close final salary pension to existing members, BP close final salary pension to new members.

UNITE say: ""It's outrageous and totally unacceptable for employers with good long-term prospects to use the recession as an excuse to cut pensions. Unite will fully support its members if they decide to stand up to employers hell bent on eroding pension benefits during the recession."

Morrisons close final salary pension - USDAW agrees.

>:(

darklighter

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Re: Company Pension
« Reply #24 on: 16-02-10, 11:12PM »
Dunno if it is relevant but my pension payments, due to a technical error, were not deducted during the bank holidays.  Now they are going to deduct the full amount from my next wage payment.  Sincere apologies were given and If I have any queries I should contact my PM.
Going off thread and on a tangent, I hate the Cardinal card.  If I have slightly less on it than will buy me some food or other then it is money in Tesco's pocket gathering interest.
How many thousands of people have money in their Cardinal card that they cannot use but Tesco can?