"For us, there is a clear example of ageism in the rules for who can be a Member Elected Director, where candidates must be less than 67, irrespective of their capability or the electorate's view of them.  This could be changed - all it needs is two paragraphs in the announcement of the forthcoming elections, one to state the change and another to tell you the period in which it could be vetoed (if 10% disapproved)."

The two paragraphs did not appear in the document that the electorate has received announcing the election plans.  This is a company decision, not a trustee decision.  The procedures agreed between members and IBM in 1996 were appropriate for the scheme then and the members were told then that the agreement was for six years.  Subsequently the government allowed the procedures to be extended to cover ten years, without giving members the opportunity to agree or disagree.  So IBM can retain the procedures, even though the pension schemes are very different from their 1996 form.   The final salary part of the scheme is closed and a large M-Plan has developed.  Figures in the Members Report show how the ageist rule will prevent a significant proportion of members being MED candidates.

One certain affect will be to prevent the AMIPP chairman, Brian Marks, from re-standing.  Since Brian topped the previous poll, retains his chairmanship of AMIPP and the national Occupations Pensions Alliance, and can now claim experience as a trustee, it is highly likely that he would have topped the poll again.  It is reasonable to ask why IBM chose to bar the candidate the electorate most wanted. 

As some of our trustees have said in this Information for potential trustee-directors,  "IBM is US led. There are no MEDs in the US, and US business practice does not see the need for them. IBM's objectives are no more likely to include effective MEDs than they are to include effective trade union officials."  

Nevertheless, it is important that effective MEDs should be appointed.  We specially urge that those contemplating being candidates, and those nominating them, absorb the information.  (The cut-off for candidature is Sept 23rd).  We anticipate that AMIPP will keep you informed in the run-up to the election, as it did for the 2002 election.

In newsletter 27 we wrote about "upcoming changes to the way "Transfer Values" are calculated in the UK".  The recent

Transfer Values describes how our scheme has handled transfer values in the past.

Because Parliament has been in recess there is nothing significant to report from there, but other groups are presenting their positions in advance of the major activity on pensions due this Winter.   Which?, the TUC, Help the Aged and Age Concern have formed the People's Pension Coalition: Their statement gives the perspective from those not actually involved in the pensions industry.  The CBI, TUC, Scottish Widows, Pensions Policy Institute and NAPF have showcased their opinions in  "The Politics of Pensions Reform." published by the Fabian Society.

 

Some research has been published on the inflation rates actually experienced by older folk.  There have often been messages on the AMIPP message board discussing this and the research adds weight to that - "In every month of the two years studied (2003 and 2004) homes run by people of retirement age (65+) faced higher inflation than those of working age."  To put this in context,  there are "multiple-whammies" affecting IBM's pensioners:

- Actual burdens are higher than these research figures show because those figures cover prices, not taxes.  Older folk who have not down-sized their residence are particularly hurt by Council Taxes.

- The government statistics used in State and IBM UK pension calculations, ie the Retail Prices Index, understate pensioners' inflation, as the research shows.

- Indexation against prices, as opposed to wages, disadvantages the retired relative to those working.  Even full inflation protection is not enough to give the retired a gain from the national growth of wealth.

- IBM's unique 70% RPI rule means that IBM UK retirees are damaged more than others.  Interestingly, Sir Edwin Nixon has said that the rule was introduced originally in the belief that pensioners needed less as they got older.  It is moot whether that was true at the time - it is certainly not true now.  Inflation's financial damage is greater for the more elderly. 

The Pensions Ombudsman has complained that the Government has not provided his department with the resources it needs to handle its workload.  As you would expect, he does not acknowledge that the work overload could effect the quality of the determinations made.  That is aggravating if you believe the determination on the IBM affair was wrong because he was overworked (to the extent it threatened his holidays), and new to pensions law (without any experienced assistant), and unaccountable (because claimants cannot challenge in the High Court in such cases).

Over a period, AMIPP has lost contact with a number of people, listed in Lost Members.  They might have changed their email address and not told us, or they might have lost their jobs and no longer have an email address. If you can help by reminding them of the need to re-register, or by being an "e-mail buddy" for them, please do.  If you know of IBM leavers who might be receiving these newsletters at an IBM email address please remind them they will need to use the change of email address page.

AMIPP, the Association of Members of IBM UK Pension Plans       www.amipp.org.uk