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Posted by A Palmer on 13 November 2000 at 19:09:49: THIS IS TO GO TO THE PENSIONS SERVICES MANAGER Dear Sir, When IBM announced the C plan, it actively encouraged staff to switch from the N plan (many people remember the posters showing a C plan retiree in a yacht and an N plan one in a rowing boat). I am not at all sure that the end result was anything like as good as staying in the N plan and buying 4% of AVC in all cases. One factor that impacted my pension is the cap that was introduced, several months after C plan signing date, apparently in response to a, then new, government limit on the percentage pension allowed at early (around 50) ages. This cut about 4 years worth of value off the pension of those of us who joined before the C plan at age 21 and then took their pension in their mid 50s. I have never seen a satisfactory answer to the question " why did those responsible not lift the cap once the government relaxed its rules -which it did some years ago?" Please ask the directors to review this matter and, if agreed, correct the situation for those of us in receipt of an affected C plan pension. If schedules mean that a formal reply will take more than a month, please let me have a date for a reply. Yours faithfully,
Posted by Ivor Horton on 13 November 2000 at 19:43:03: In Reply to: C PLan capping posted by A Palmer on 13 November 2000 at 19:09:49: I wrote to Kevin Waller about this a week ago. In my case as a result of the capping formula 10% of my years of service accrued no pension. I asked for this or to remedied, or an explanation as to how it is justified that several years' pension contributions produce zero return. It may be a good time for anyone else affected by this to write requesting that this inequity be removed. Posted by A Palmer on 17 November 2000 at 16:15:22: In Reply to: C PLan capping posted by A Palmer on 13 November 2000 at 19:09:49: Kevin Waller's reply of 13 Nov basically says that Re a) Unfortunately he didn't say to whom in IBM I should address
queries Posted by Ivor Horton on 27 November 2000 at 13:54:26: In Reply to: Re: C PLan capping posted by Ivor Horton on 13 November 2000 at 19:43:03: For those interested in this little side issue that removes a significant percentage of pension entitlement - I received a reply from Kevin Waller. Apparently the C-Plan cap that applies to the longer serving members of the plan is not his concern or that of his department. It is a matter of "company policy". I have written asking who is responsible for setting this policy but have not received a reply yet... Posted by A Palmer on 04 December 2000 at 19:54:51: Several of us whose pension was capped because we joined young and
left in out mid 50s have been wondering why we lost up to 10% of our
pension. I have tried the same route as others -to get Pension Dept to
re-look at it all - with no success yet. But I now realise that I'd
forgotten that IBM always said that execess money would be returned over
time. The following is the latest state as far as I am concerned....... I await the outcome of a review of my particular case. Posted by Ivor Horton on 05 December 2000 at 19:00:19: In Reply to: C Plan capping posted by A Palmer on 04 December 2000 at 19:54:51: You seem to have obtained a more positive response from Kevin than I did. It sounds encouraging! Does the MIL explain under what circumstances capped pensions are increased, and is the review an automatic process or do you have to agitate for it? Posted by A Palmer on 14 December 2000 at 16:56:37: In Reply to: C Plan capping posted by A Palmer on 04 December 2000 at 19:54:51: Pending a full response via the official procedure, Diane Lloyd is saying that the only excess that is returned is that generated by additional payments (not the C plan itself) above government guidelines. I still find it "strange" that MIL 582 uses EXACTLY the same formula to cap both C Plan and voluntary additions. So there is either a mighty unusual coincidence or IBM originally added the cap to the C Plan because of the then government guidelines and mean to remove it when (as they did) the Government guidelines were relaxed. Posted by A Palmer on 22 December 2000 at 16:30:30: In Reply to: Re: C Plan capping posted by A Palmer on 14 December 2000 at 16:56:37: Dave Newman's reply to my letters essentially said..... I was not asking for the Trustee to "unilaterally change" the C Plan. I was asking for the Trustee's position (based on its acting in the best interests of the members ) on C Plan capping in the light of the fact that the government, some while ago, relaxed the rules that were in place back in the early 80s. Those rules limited the %age allowed at various ages from 50 on. IBM had to include the cap (which applied to both C Plan and voluntary additional pension ) largely because those who joined IBM in their early twenties and took the C Plan option at the earliest opportunity would otherwise have exceeded that limit if they retired in their 50s. That is why the cap bites so strongly on just that set of people. I note that the current C Plan cap calculation is exactly as per the formula which MIL 582 states is there because of the need to meet Inland Revenue guidelines. I find that just too much of a coincidence. As it happens, I chatted to Sir Edwin during his trip to Paris to get sign off to the C Plan. Somewhere along the line his obvious care for his employees and delight in the plan has been lost by his successors. Possibly they just forgot to review the need for the cap? So, I ask again, what is the position of the Trust directors on those points, in particular are they prepared to discuss the matter with the Company? (written 22 Dec ) |
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