Royal Mail has developed its proposals on the reform of its pension scheme following discussions with the workforces’ representatives. My department received a briefing on the final proposals from Royal Mail but has not been involved in their formulation.
During the period 1995-2002, the pension fund was in surplus. In 2001, the fund was some 105 per cent. funded. The current deficit arose because of market changes, revised assumptions in life expectancy and the new accounting standards, which required pensions to be reported on company balance sheets. Royal Mail is now addressing the deficit through additional contributions to the fund.