February 2010
GMB NEWSLETTER
AA PENSION MATTERS
AA
Pension Matters
Revised Pension Proposals (12th February 2010)
Following the GMB Ballot results at the end of January, the AA has moved
some way from the original proposals but has NOT moved far enough.
The new proposals make for very interesting reading, and should be read
in conjunction with the actions of Private Equity since the takeover of
the AA in 2004.
It is absolutely clear that the staff and members of the Pension Scheme
now have to pay for the greed of Private Equity over the last six years.
The proposals are already accepted by the Pension Trustees subject to
the consultation process, we have not seen any evidence that the
Trustees have taken any action over the last six years, to control the
unabated greed that has bled the AA of cash and the Pension Fund.
From the figures on page 2 of the proposals it is evident that the
actions of AA Management, and the dictators of Private Equity, in
conjunction with the sacking of staff, the Pension Fund has been denied
of contributions;
12,157 deferred Members of the Staff Final Salary Scheme
214 deferred Members of Management Scheme
1,272 in the CARE Scheme because the Final Salary Scheme is closed to
new staff
60 deferred Members of the CARE Scheme
______
13,763 not having made contributions to the Final Salary Scheme
Of course much of this figure will be where staff left of their own free
will and have their pensions deferred, but GMB has constantly protested
against the AA bullying and sacking of over 4,000 staff through
performance and other measures for the sole purpose of reducing the wage
bill, so that their profits could grow.
Consequently, if there was not such a big cull of staff and the CARE
scheme introduced there would be nearer 9,000 staff in the Final Salary
Scheme, providing a good service to the motoring public, but of course
that would not make the mega bucks for Private Equity.
The closure of the Final Salary Scheme to new starters, and the
introduction of the CARE Scheme spelt the death knell in the commitment
of the AA to provide a Final Salary Pension Scheme into the future.
Now the AA Management are offering staff to transfer from the Final
Salary Scheme to the CARE Scheme but cannot transfer back.
Who can trust this Management?
Staff are also expected to pay up to 2.5% extra for the privileges of
loss of pension rights to line the pockets of the ‘fat cats’.
It is obvious that the Early Retirement Scheme is up for constant review
to protect the Private Equity Profits.
Staff are encouraged to reduce their pension entitlements in the CARE
Scheme through lower contributions, thus reducing the AA liabilities.
There was no deficit in the Pension Scheme in 2004 when Private Equity
took over, and the special Lump Sum contributions totalling £94.7
million were borrowed against the Company debts, so the total Employer’s
Contributions are misleading.
There is no mention of the investments from the Pension Funds into
Private Equity; how much was invested, and how much was returned from
the investment.
The Pension Fund owns the property of the AA; there is no mention of how
much rental income is returned to the Fund from the AA, or how much the
rental has increased since 2004.
The deficit of the Scheme is said to be £228 million. How odd that
Private Equity took £300 million from the AA/SAGA merger.
The proposed savings this year are said to be £30 million. How odd that
Tim Parker was paid off with £30 million when the AA/SAGA merger went
ahead.
The sacking of staff for higher profits robbed the Pension Scheme of
over £2 million in income contributions.
The truth is that the AA was a profitable company at the beginning of
2004, making over £100 million profit, employing over 9,000 staff and a
healthy Pension Scheme.
Now in the hands of Private Equity, the Pension Scheme is in deficit,
the Company is in £4.6 BILLION debt, and the staffing levels at an all
time low.
Millions of Pounds have been raked out of the Company to line the
pockets of Private Equity. Money was thrown at Solicitors to help get
staff out. Parker got £30 million for wrecking the Company, but Private
Equity bosses walked off with £300 million.
Did the Pension Trustees ever complain?
Did the Management Consultation Committee ever complain?
Did the Union that was set up with Management ever complain?
The simple answer is NO; because there were too many ‘snouts in the
trough’.
The AA Management, as an agent of Private Equity, is accountable for the
Pension Scheme mess, and must and should be held accountable, together
with their silent partners who nodded the destructive process through.
PAUL GRAFTON
GMB Organiser
paul.grafton@gmb.org.uk
PAUL MALONEY
GMB National Secretary
paul.maloney@gmb.org.uk
Join GMB on line at www.gmb.org.uk
Telephone 020 8971 8390 or 020 397 8881
