MNRPF and P&O strike deal ‘after intense and complex’ talks
Pardon the Interruption
This article is just an example of the content available to mallowstreet members.
On average over 150 pieces of new content are published from across the industry per month on mallowstreet. Members get access to the latest developments, industry views and a range of in-depth research.
All the content on mallowstreet is accredited for CPD by the PMI and is available to trustees for free.
The Merchant Navy Ratings Pension Fund has reached an agreement with ferry operator P&O. The details of the deal have not been disclosed.
Trustee chair Doug Ross from Pi Pension Trustees told members that, “after intense and complex negotiations, agreement between the trustee and [P&O Ferries] was finally concluded on 4 May 2023”.
He said the trustees’ objectives had been “materially achieved” but did not disclose the details of the deal.
“The trustee believes that this is a very positive step and that [it] is in the best interests of members and all other MNRPF stakeholders,” Ross added.
A spokesperson for MNRPF confirmed that “after productive, ongoing discussion between MNRPF, DP World [owner of P&O] and P&O Ferries, an agreement for future commitments to the fund by P&O Ferries has been reached”.
A spokesperson from P&O Ferries said: “We are pleased to have reached a mutual agreement with the trustee of the MNRPF on a positive way forward.”
A spokesperson from P&O Ferries said: “We are pleased to have reached a mutual agreement with the trustee of the MNRPF on a positive way forward.”
The agreement will be fully taken into account for determining the funding status of the £1.2bn MNRPF during the multi-employer fund’s 2023 valuation, which will be published later this year. As at March 2022, the scheme was 98% funded, up from 96% a year earlier. P&O Ferries had outstanding debt to MNRPF of about £146m, secured by a guarantee over three of its ships.
mallowstreet understands the current deal was reached without TPR involvement. The spokesperson for the scheme said: “We and P&O have kept the Pensions Regulator informed during the course of negotiations as is standard practice.”
If the ferry operator ever became insolvent, other employers in the scheme could be on the hook for its deficit, but the MNRPF’s position has improved along with that of many defined benefit schemes. The fund had a £19m shortfall in March last year, down from £56m a year earlier. P&O’s share of the net deficit at 31 December 2022 was estimated by DP World to be at 46.49%.
P&O Ferries hit the headlines in spring last year when its owner DP World summarily sacked the entire 800-strong workforce via video call to replace them with low-paid international agency workers. Unions and politicians decried it as foul play, while Dubai-based DP World defended its decision saying the ferry company’s financial position demanded drastic action.
Regulators were concerned at the time that the sudden redundancies put scheme members in a vulnerable position and at risk of scams. They issued a warning in April 2022 urging former P&O Ferries workers to be cautious.
What would you have demanded as contributions or security in negotiations with this employer?
