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Xafinity Consulting PowerPoint Template

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Pension built up between April 97 and July 09 RPI min 3% max 5% p.a. Pension built up between July 09 and July 11 RPI max 5% p.a. Pension built up after ... – PowerPoint PPT presentation

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Title: Xafinity Consulting PowerPoint Template


1
The University of DundeeSuperannuation Life
Assurance Scheme (UODSS) Presentation to
members
11 June 2014
2
  • Todays agenda
  • Introduction
  • UODSS
  • Membership and benefit outgo
  • How your benefits are calculated
  • How your pension will increase
  • Recent changes - partial transfers
  • Recent changes - impact of the March 2014 Budget
  • Whats on the horizon
  • Update on Scheme Funding
  • Long term strategy

3
  • Introduction
  • Welcome to the 2014 Member Presentation
  • We have listened to feedback from the 2012
    Presentation and incorporated some of the
    suggestions in this session
  • Copies of the slides will be made available on
    the pensions web page
  • We will contact you after the presentation to get
    your feedback to ensure we continue to cover the
    issues you want to hear about

4
  • Change in UODSS membership

5
  • UODSS future benefit outgo

Since UODSS is open to new members, payments will
stretch out even further into the future...
6
  • How your benefits are calculated
  • Final Salary
  • Your pension is calculated as 1/80th of Final
    Pensionable Salary for each year of Pensionable
    Service
  • This is equivalent to building up blocks of
    1/80th of salary each year, which increase with
    your salary up to retirement (or leaving service)
  • Career Average Revalued Earnings (CARE)
  • Your pension is calculated as 1/80th of revalued
    earnings for each year of Pensionable Service
  • This is equivalent to building up blocks of
    1/80th of salary each year, which increase with
    inflation up to retirement (or leaving service)
  • You will also receive a tax free lump sum of
    three times your total pension when you retire

7
  • How will my pension increase once in payment?

CARE
Final Salary
8
  • Benefit calculation timeline
  • Current UODSS benefits

Increases in payment 3 p.a. Guaranteed Minimum Pension is subject to statutory minimum increases 3 p.a. Guaranteed Minimum Pension is subject to statutory minimum increases 3 p.a. Guaranteed Minimum Pension is subject to statutory minimum increases RPI min 3 max 5 p.a. RPI max 5 p.a. CPI max 5 p.a.
Increases before retirement Active In line with Pensionable SalaryDeferred CPI max 5 p.a. Active In line with Pensionable SalaryDeferred CPI max 5 p.a. Active In line with Pensionable SalaryDeferred CPI max 5 p.a. Active In line with Pensionable SalaryDeferred CPI max 5 p.a. Active - CPI max 5 p.a. Deferred CPI max 2.5 p.a. Active - CPI max 5 p.a. Deferred CPI max 2.5 p.a.
Normal retirement age Males 65 Females - 60 Males Females - 60 Males and females - 65 Males and females - 65 Males and females - 65 Males and females - 65
Benefit calculations Final Salary Final Salary Final Salary Final Salary Final Salary CARE
9
  • Recent changes - partial transfers
  • The Trustees and University recently agreed to
    amend the Rules of the Scheme to allow partial
    transfers introducing extra flexibility for
    members
  • How do partial transfers work?

10
  • Recent changes - March 2014 Budget announcements
  • How do the announcements affect me?
  • More flexibility to exchange small pensions for a
    one-off lump sum
  • Increase in Minimum Pension Age from 55 to 57
    from April 2028
  • State Second Pension (S2P) ability to top up
    S2P before Single Tier State Pension applies
  • Possibility that restrictions will apply to
    transfers from Defined Benefit (such as UODSS) to
    Defined Contribution schemes
  • For more information, please refer to the
    Trustees Response to the Budget Announcements
    Factsheet available from the Pensions Area of the
    University website

11
  • Possible changes in the future
  • From April 2016, the Single Tier State Pension
    will combine the Basic State Pension (BSP) with
    the State Second Pension (S2P)
  • At present...
  • UODSS members (like members of most Defined
    Benefit schemes) are currently guaranteed a level
    of benefits well above the S2P pension and do not
    earn an S2P benefit while contributing to the
    Scheme.
  • In return members (and the University) pay lower
    NI contributions to the Government
  • From April 2016...
  • Everyone will start to build up the new Single
    State Pension in addition to any other pension
    benefits they earn
  • UODSS members (and the University) will have to
    pay higher NI contributions
  • It is likely that Defined Benefit schemes (such
    as UODSS) will be able to amend their rules to
    allow for the change
  • It is likely that the University will consider
    this issue carefully and members will be informed
    if any changes to the Rules are planned

12
  • Scheme Funding
  • What has happened since the last valuation?
  • How does this compare with other schemes?

13
  • Views on Scheme Funding
  • The period since the previous valuation was very
    challenging due to the recession and Eurozone
    crisis and the impact on liability values
  • The issues faced by UODSS are the same as those
    faced by a large number of schemes across the UK
  • The vast majority of other defined benefit
    schemes are in a similar position
  • The Trustees will continue to take a long term
    view on investment and funding
  • They will also continue to gain reassurances from
    the University for its ongoing support for UODSS

14
  • Long term strategy
  • The University has re-affirmed its commitment to
    the Scheme
  • UODSS is a very long term savings vehicle and the
    Trustees take a long term view when setting the
    funding and investment strategy
  • Short term fluctuations in the funding position
    are expected. The Trustees monitor the funding
    position closely to avoid any surprises and take
    action if required
  • Detailed health-check
  • A full valuation of UODSS will be carried out at
    31 July 2014
  • The Trustees will also review the Schemes
    investments
  • The Trustees will update members on the outcome
    of the 2014 valuation after completion expected
    by Q2 2015

15
  • Any questions?
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