Pension News 10/06

October 15th, 2006 by JCB
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PENSION NEWS

The Secretariat

Those of you who ring the Secretariat may notice that there has been a change to the staffing levels. As part of an ongoing reduction in costs the Trustees decided to make the part-time position of Secretarial/Administrative Assistant redundant. This has resulted in Vicki Apps leaving the Secretariat and taking up a life of leisure with more time to spend enjoying her numerous hobbies.

This leaves Richard and me to carry on with the day to day running of the Fund and the reduction in staff should not affect the standard of service you have been receiving.

Trustees

There have been changes in the Trustee Board, as well, with Stewart Lee (Forth pilot) resigning from the Board and retiring from pilotage. Tony Anderton (Bristol pilot) has stepped up as a full Trustee with Alastair Gibson (Forth pilot) becoming a new Alternate Trustee.

On the Port side David Holmes has retired as an Alternate and Graeme Clark, Aberdeen, taking his place as an Alternate Trustee.

Investment Strategy

The Trustees are continuing to implement their investment strategy with the last £10m tranche disinvested from the equities portfolio and transferred to Quellos at the end of October. This completed the second phase of the strategy and the Trustees will be discussing the third phase at their November quarterly meeting.

Summary of Funding Statement

In accordance with current legislation and Government dictates the Summary of Funding Statement was sent out to all P.N.P.F. members on 20 September 2006. I am pleased to report that the mass hysteria expected by some pension pundits did not occur among P.N.P.F. members. It appears most members realised that the Statement represented a snapshot of pensions at a particular date and that shortfalls should continue to reduce over time. Although I will admit that there were a few telephone calls seeking clarification on one or two points.

Benefit changes

Flexible Retirement

From 1 January 2007 the Trustees have agreed that flexible retirement will be allowed in the PNPF. This means you cold continue to work as a pilot while receiving your pension from the PNPF. There are three caveats attached to this option which are:

·        You must be over age 50 (age 55 from B2010)

·        Once your PNPF pension has been put into payment you will not be allowed to continue to contribute to the PNPF or accrue any future pensionable service.  Your entitlement to death in service and ill health benefits will also cease.

·        You must have the consent of your Competent Harbour Authority.

The Association’s Payment Proposal

The Trustees have been in consultation with the Association of Participating Bodies in the PNPF (the “Association”) regarding the Fund’s level of funding. This culminated in the Association putting forward a voluntary payment proposal to the Trustees. The proposal has the support of the majority, but not all, of the CHAs with employed and self-employed active pilots, is voluntary and is not legally binding on either the Trustees or the CHAs.

Following actuarial and legal advice the Trustees agreed to accept the Association’s proposal, which is retrospective from 1 January 2006 and payable over a 5 year time period.

News in General

Disclosure Regulations

The Department for Work and Pensions (DWP) announced that the draft regulations which were due to come into force in October have been dropped. The new regulations would have introduced annual benefit statements for defined benefit (DB) schemes (the PNPF already provides these) and the concept of information disclosure within a

“reasonable time”.

Age Discrimination

New laws covering age discrimination are to be postponed for two months and will now come into effect on 1 December 2006. The Government says it intends to use the delay to change the Regulations so as to clarify what is permitted and what is not. The postponement will give Trustees longer to prepare for the changes.

Age Regulations

Judicial review proceedings have been commenced by Heyday, on behalf of Age Concern, to challenge the Government’s introduction of a national default age of 65.

Contributions up, Membership down

A recent survey by the Government Actuary’s Department (GAD) reveals that employer pension contributions rates in the private sector are increasing while the number of members of schemes is falling.

Pensions experiment

A recent experiment challenged 26 households, aged between 30 and 50, to live off the equivalent disposable income today’s pensioners received if they relied on the state pension. All but one household, overspent their state pension allowance by 158 per cent. The majority spending their weekly entitlement within three days.

Debbie Marten

Debbie@pnpf.co.uk