A message from the Trustees

Transcription

1 LUXFER GROUP PENSION PLAN A message from the Trustees Welcome to the Luxfer Group Pension Plan. Following discussions with the Company through 2015 the Plan closed in April 2016 and the members of the Plan then in service joined Luxfer Group Retirement Savings Plan. The benefits outlined in this booklet therefore relate to service up to 5 April 2016; for information on benefits for service after that date members should refer to the Luxfer Group Retirement Savings Plan booklet which may be found on the website. Please note that this booklet gives you a straightforward guide to the Plan, the benefits you get and the way they work. However, the legal constitution of the Plan is contained in the Trust Deed and Rules, which is available on request from the Pensions Manager. If there are any questions of interpretation between this booklet and the Trust Deed and Rules, the provisions of the Trust Deed and Rules will apply. We have tried to avoid using too many technical terms; those that we do use are explained on pages 4 and 5. This version of the booklet reflects the Trustees' understanding of tax, pensions and employment law as at June If any of these laws change the contents of this booklet may require amendment in future. We would like to remind you that the Plan is for your benefit. If there are any questions you have or if there is anything you don t understand about the Plan or your pension arrangements, please contact the Pensions Manager, your Local Pensions Administrator, Local Pensions Committee or Group Pensions Council Representative, who will be able to help you. The Trustees of the Luxfer Group Pension Plan, Anchorage Gateway, 5 Anchorage Quay, Salford M50 3EX Booklet updated June 2016 LUXFER GROUP PENSION PLAN 1

2 About the Plan The Luxfer Group Pension Plan (the Plan) was established in 1996, following the acquisition of various businesses from British Alcan Aluminium plc. Members of the British Alcan Retirement Income and Life Assurance Plan (the RILA Plan) at the time of the acquisition were given the opportunity to transfer their entitlements under the RILA Plan into the new Luxfer Group Pension Plan. From 1 June 1998 the Plan closed to new members and currently new employees are eligible to join the Luxfer Group Retirement Savings Plan, a money purchase scheme. In 2004 the way pensions are calculated changed to a Career Average Revalued Earnings ( CARE ) basis, as described on page 8 of the booklet. The Plan was amended again with effect from 6 October 2007, following the 2006 actuarial valuation, to enable members to continue to enjoy the benefits of the CARE Plan, but at an affordable cost. In April 2016 the Plan closed to future accrual of benefits, although the Trustees continue to administer the benefits earned to this date. The Plan is established under trust which means that the Plan is looked after by Trustees who are responsible for the administration of the Plan. Amongst their other duties, this includes investing the Plan s assets, which are completely separate from the assets of the Company. The actual investment is carried out by independent investment managers appointed by the Trustees. At June 2016 there are six Trustees, four appointed by the Company, one elected by members of the Group Pensions Council and one elected by the pensioner members (see page 21 Do I have any say in the running of the Plan? ). This booklet provides a guide to the Plan s main provisions. The benefits to which you are entitled are governed by the Trust Deed and Rules, a copy of which may be obtained on request to the Pensions Manager. If there are any questions of interpretation between this booklet and the Trust Deed and Rules, the provisions of the Trust Deed and Rules will apply. The Plan is registered as a pension scheme under the Finance Act 2004 which governs the way contributions and benefits are treated for tax purposes. Until April 2016 you were contracted-out of the Additional State Pension (known as SERPS and S2P) which meant that you and the Company paid lower National Insurance contributions, but had a limited entitlement to this pension. LUXFER GROUP PENSION PLAN 2

3 Contents Common Terms... 4 State Benefits and the Plan Contributions Normal Retirement Benefits Normal Retirement Cash Sum Early Retirement Ill Health Inflation Protection Death in Service Death in Retirement Leaving Service Important General Information Help and Advice LUXFER GROUP PENSION PLAN 3

4 Common terms Every care has been taken to avoid using technical terms in this booklet, but, it is sometimes unavoidable. The following are terms and phrases you will see throughout this booklet, with an explanation of their meaning. For ease of reference these appear in the text in italics. Plan means the Luxfer Group Pension Plan. Company means Luxfer Group Limited or any other associated company by which you are employed. LPC Representative is your Local Pensions Committee Representative (see page 21). These are elected by members of the Plan. There is at least one LPC Representative at every site. GPC Representative is your Group Pensions Council Representative. One representative is elected by each Local Pensions Council. The Trustees are responsible for running the Plan. At June 2016 there are six Trustees, four appointed by the Company, one elected by members of the Group Pensions Council and one elected by the pensioner members. Pre-92 Member is a member who joined the RILA Plan before 1 January 1992 and who transferred their benefits into the Plan. Post-92 Member is a member who joined the RILA Plan or the Plan on or after 1 January Salary is your gross earnings which are defined as pensionable by the Company. For this purpose if your basic salary is 76,000 or more (or the higher figure determined by Luxfer Group Limited and notified at any 6 April) none of your earnings above this figure will be pensionable under the Plan (but may be pensionable under the Luxfer Group Retirement Savings Plan). Plan Salary at each 6 April is your Salary in the last 12 months less the State Pension Deduction for the same 12 months. Final Plan Salary (as used to calculate your accrued pension at 5 April 2004) is the sum notified to you on your personal benefit statement as at 6 April This is equal to your gross earnings which are defined as pensionable by the company, excluding non-contractual overtime earnings, in the 12 months up to 5 April 2004, PLUS the annual average of your non-contractual overtime earnings (if any) in the 36 months up to 5 April 2004, LESS a State Pension Deduction of 4004 (reduced pro-rata if employed part-time). If greater, the annual average of your Plan Salary over the 36 months up to 5 April 2004 or the average of the highest three consecutive tax years Plan Salaries in the last ten years ending 5 April 2004 will be used (note: Plan Salary has the meaning used in the September 2005 version of this booklet). Notional Earnings are contractual pay and are used if you suffer a loss of earnings because of certified ill-health absence in any year. State Pension Deduction is the lower of the basic State pension for a single person and the State Lower Earnings Limit, the earnings level at which you become entitled to State benefits. For part-time employees a pro-rated State Pension Deduction will be applied. LUXFER GROUP PENSION PLAN 4

5 Pensionable Service is the period (measured in years, with completed days counting proportionately) for which you have been a contributing member of the Plan or which has been transferred from the RILA Plan. In addition, any period credited as a result of a transfer value in respect of your membership of a previous employer s plan will count towards Pensionable Service. Any service from April 2016 is not counted as pensionable. Normal Retirement Date is your 65th birthday. S2P" or "SERPS are names given to the additional State pension. SERPS stands for "State Earnings Related Pension Scheme" which was the name given to the additional State pension up to April This was then modified and renamed the State Second Pension (S2P). State Pension Age will depend on when you were born. Full details can be found at by going to "working, jobs and pensions" and clicking on "State pensions". GMP (Guaranteed Minimum Pension) corresponds to the pension you would have earned from SERPS had you not been contracted-out during your membership of the Plan (and possibly of a previous pension plan) before 6 April Widow s GMP for female spouses is half the member s GMP, subject to Social Security requirements being met. Widower s GMP for male spouses is half the member s GMP earned from 6 April 1988, subject to Social Security requirements being met. Protected Rights Fund is the value at the relevant time of the sum of the following: your own contributions to the Plan between 6 April 1997 and 5 April 2012 (excluding any additional voluntary contributions) part of the Company s contribution to the Plan in respect of you between 6 April 1997 and 5 April 2012, equal to its saving in National Insurance contributions the further payment to the Plan in respect of you between 6 April 1997 and 5 April 2012 by the Government which depend on your age (both the Company s and the Government s payments arise from the method by which you were contracted-out of S2P between April 1997 and April 2012) the investment growth earned by the Plan assets in respect of these contributions until further notice, this will be in line with the FT-SE All Share Index with income reinvested. Lifetime Allowance is the total value of benefits that may be paid to you without a tax penalty (see page 10). Registered Pension Arrangement means a pension scheme, whether an occupational scheme or a personal arrangement, which is approved for tax purposes under the Finance Act LUXFER GROUP PENSION PLAN 5

6 State benefits and the Plan During your Pensionable Service you have been contracted-out of SERPS and S2P. This means that both you and the Company have paid lower National Insurance contributions (see page 7) but the pension you receive under SERPS and S2P is significantly reduced. Being contracted-out, the Plan provides benefits which are at least as good as those that would have been provided under SERPS and S2P and generally are substantially better than SERPS and S2P could have provided. From April 2016 the State pension scheme was changed and the ability to contract-out was withdrawn. You can find out about the new State pension and apply for a forecast of your State pension entitlements at by going to "working, jobs and pensions" and clicking on "State pensions". LUXFER GROUP PENSION PLAN 6

7 Contributions The Plan closed in April 2016 and the requirement for members to contribute ended. Company contributions continue to eliminate any funding deficit and to reimburse the Trustees for the cost of levies paid to the Pension Protection Fund. In addition the Company pays the Trustees costs for managing the Plan. LUXFER GROUP PENSION PLAN 7

8 Normal retirement benefits The Plan closed in April 2016 and the last year in which pension accrued was that ending 5 April When do I retire? Benefits under the Plan are defined with reference to your Normal Retirement Date. What benefits are payable? A pension is payable on the 1st of each month for the rest of your life, with a subsequent pension for your widow(er) (see page 17). How much will my pension be? For each year of Pensionable Service (and any additional part year) up to 5 April 2004 you will accrue a pension of: 1.75%* x Final Plan Salary x Pensionable Service * For service pensionable in the BACO 1983 General Scheme up to 30 April 1984 this is 1.4%. For the period of Pensionable Service between 6 April 2004 and 5 October 2007 you will accrue a pension of: 1.75% x Plan Salary for the years to 5 April 2005, 5 April 2006 and 5 April 2007, and for the six months to 5 October 2007 For the period of Pensionable Service from 6 October 2007 you will accrue a pension: based on the Pension Scale you select in the table below x Plan Salary for the six months to 5 April 2008, for the year 5 April 2009 and for each subsequent year ending 5 April up to 5 April The Pension Scale depends on the rate of contributions you selected as follows: Contribution Rate Pension Scale Pension Scale 1 9.8% 1.50% Pension Scale 2 7.4% 1.31% You may change the Pension Scale you accrue (and so the rate of contribution you pay) with effect from 6 April each year. A form notifying your Local Pensions Administrator of a change in contribution rate may be obtained from the Plan website Note: (i). the Company reserves the right to withdraw the option to switch to the 9.8% contribution rate: (ii). changing Pension Scale will also affect the pensions payable after your death (see pages 18 and 20). (Note this option ceased on 6 April 2015) LUXFER GROUP PENSION PLAN 8

9 Normal retirement benefits (cont) At each 5 April until 5 April 2016 your total accrued pension will be revalued (if necessary) by the percentage that the Retail Prices Index has increased over the 12 month period up to the preceeding 30 September, limited in any year to a maximum increase of 5%. In the period from the last 6 April (falling before 6 April 2016) before you retire or leave service up to the date you retire or leave service, you will accrue a further pension of your selected Pension Scale x the Plan Salary earned in this period, but no further revaluation will be added to your accrued pension. Following the closure of the Plan your accrued pension as at 5 April 2016 will be revalued as a preserved pension (see page 18). Benefit Statements Each year you will receive a benefit statement showing the growth in the amount of your accrued pension. Your 2004 benefit statement showed the amount of your accrued pension at 5 April Statements at 6 April 2016 and subsequently will show your accrued pension at that date, including any subsequent revaluation. From 2010 the statement will also show the effect of the Longevity Adjustment Factor (see page 12). Guarantee: If it is more, your pension for Pensionable Service between 6 April 1997 and 5 April 2012 will be the pension which can be secured by your Protected Rights Fund. You may ask the Trustees to use the value of the Protected Rights Fund to purchase an annuity from an insurance company chosen by you. If you take this option your Plan pension will be reduced to take account of the benefits secured by your annuity. Is my pension taxable? Your pension is taxed as income in the same way as your earnings. What about my AVC fund? Your AVC fund will be used to increase your Plan benefits when you retire. You will have a number of options: To include your AVC fund as part of your tax free cash sum (see page 11). To increase the pension payable from the Plan: in this case the AVC fund (or the part remaining after taking a cash sum) will be used to buy a pension payable on the same terms as your Plan pension (with the option to continue the pension after your death to a spouse or dependant) using rates approved by the Plan Actuary. To use your AVC fund (or the part remaining after taking a cash sum) to purchase an annuity from the insurance company chosen by you. LUXFER GROUP PENSION PLAN 9

10 Normal retirement benefits (cont) Lifetime Allowance When you retire your benefits will be tested against your Lifetime Allowance. If the value of your benefits exceeds the Lifetime Allowance (which in most cases will be unlikely) any excess benefits will suffer an additional tax charge. The Lifetime Allowance applies to the total of your benefits from all Registered Pension Arrangements and when any benefits start you will be notified of the value of the Lifetime Allowance used. You will be asked to provide this information to the administrators of other Registered Pension Arrangements before they start your pension. For 2016/17 the Lifetime Allowance is 1 million. The value of your benefits will be taken as the face value of any cash sum plus 20 times your initial pension. So, if when you retire you take a cash sum of 35,000 and a reduced pension of 6,000 the Lifetime Allowance used will be: 35,000 + ( 6,000 x 20) = 155,000 If you retire early your bridging pension will be included in this calculation. Longevity Adjustment All pension schemes are affected by improvements in life expectancy. Pensioners in general are living longer than previous generations and this means more funds are required to pay their pensions. To afford some protection for the Plan the longevity adjustment has been introduced to allow for any improvement in life expectancy above that provided for in the actuarial valuation as at 5 April The adjustment will be applied to members retiring after 27 April 2010, in respect of pension accrued from 6 October The adjustment factor is the ratio of Base Life Expectancy and Current Life Expectancy. Base Life Expectancy means at retirement or earlier death, the average future life expectancy (weighted by the number of male and female members of the Plan) of an individual, using the mortality assumptions employed for the actuarial valuation as at 5 April Current Life Expectancy means at retirement or earlier death, the average future life expectancy (weighted by the number of male and female members of the Plan) of an individual, using a mortality assumption appropriate in the year of retirement. LUXFER GROUP PENSION PLAN 10

11 Normal retirement cash sum Can I exchange part of my pension for a cash sum? Yes. When you retire, you may give up part of your pension for a cash sum. The maximum sum that you will be permitted to receive is calculated by multiplying your Plan pension by a factor. At June 2016 the factors to apply are shown in the table below. These factors are not guaranteed and may change at any time without notice. Age at retirement Multiple of pension & & Note: if, as at 5 April 2006, the cash sum formula then in use gave a higher cash sum, a higher maximum cash sum for the pension earned up to 5 April 2006 will be allowed. If you have paid AVCs to the Plan, the pension secured by your AVCs (for the purpose of this calculation, payable on the same terms as your Plan pension but without continuation after death to a spouse or dependant) will be added to your Plan pension before your cash sum is calculated. Your Plan pension will be reduced to allow for any cash sum taken. As an example, if you retire at age 65 and your Plan pension is 7,700 then the maximum cash sum and reduced pension will be calculated as follows (this example ignores any AVCs): Maximum cash sum: 7,700 x 4.3 = 33,110 Reduction in pension: 1 for every cash taken 33,110 / = 2, Reduced pension: 7,700-2, = 5, NB: The rate of is not guaranteed and may be changed by the Trustees at any time without notice. At lower ages the rate will be greater. Page 15 explains how increases to your pension relate to your reduced pension. Your remaining pension must not be less than the pension secured by your GMP earned before 6 April 1997; this may restrict the amount of cash you can take. If you have an AVC fund, you will be able to take it as part of your cash sum. Under current legislation any cash sum taken on retirement is tax-free. LUXFER GROUP PENSION PLAN 11

12 Early retirement Can I retire early? In this section retire means to permanently and completely stop working for the Company. If you have already left the Company and have a preserved pension the provisions on page 18 apply. Pre-92 Members may retire on or after their 60th birthday (or after their 55th birthday, providing that their age plus their Pensionable Service totals at least 75 years) and receive a discounted pension. In exceptional circumstances, and provided your Managing Director and the Trustees consent, it may be possible for any other member to retire at any time after age 55 and receive a discounted pension. There may be circumstances where, by agreement with your Managing Director and the Trustees, you may be permitted to commence drawing your Plan pension while still working for the Company. The pension will be calculated in the same way as if you were retiring. It must be understood that this is not a right and will be used sparingly where it is advantageous to you and the Company. As you see, in many circumstances it will not be to your benefit to draw your pension early as it will be discounted for early payment. How much will my pension be if I retire early? If you retire before your 65th birthday, your pension will be calculated on your pension accrued to the date of retirement, but subject to discounting because your pension is paid for a longer period. Your pension will also be subject to the Longevity Adjustment Factor (see page 10). Discounting factors For Pre-92 Members, if you retire on or after age 60, no discounting is applied to the pension for Pensionable Service before 1 July For Pensionable Service after that date the discounting is 2% pa for each year before age 65. If you retire before age 60, additional discounting of 2% for the period before age 56 and 4% for each year from age 56 to 59 is applied. For Post-92 Members, your pension will be discounted by 4% for each year by which your retirement precedes age 65. In all cases discounting on a pro-rata basis will be applied to additional incomplete years. Can I exchange part of my pension for a cash sum? Usually, you will also have the option of exchanging part of your pension for a cash sum. However, this option may be restricted as a result of the requirements for contracting-out of S2P. LUXFER GROUP PENSION PLAN 12

13 Early retirement (cont) What happens until my State Pension Age? You will receive a Bridging Pension until your State Pension Age. The Bridging Pension will be calculated as: For Pensionable Service up to 5 October % x State Pension Deduction x Pensionable Service up to 5 October 2007 x Discount Factor For Pensionable Service after 5 October 2007 The Pension Scale applicable on the 6 April which is at least 12 months before you retire x State Pension Deduction x Pensionable Service from 6 October 2007 x Discount Factor The bridging pension is not payable to Post 92 members who are former employees entitled to a preserved pension (see page 20). LUXFER GROUP PENSION PLAN 13

14 Ill health The following applies only if you retire from Company employment. What happens if I am seriously ill? If you are seriously ill or disabled and unlikely to ever work again, you may retire early, whatever your age, subject to the Company s and the Trustees approval. Medical evidence will also be required. You will be entitled to receive a pension payable immediately for the rest of your life. How will my pension be calculated? Your pension will be based on your revalued accrued pension at the date of retirement. It will not be reduced for early payment. Your pension will also be subject to the Longevity Adjustment Factor (see page 10). Usually, you will also have the option of exchanging part of your pension for a cash sum subject to Inland Revenue rules. Total commutation if terminally ill If, when you retire, you are terminally ill and expect to live less than 12 months (as certified by a medical practitioner) you can ask the Trustees to pay a cash sum in lieu of the whole of your pension. The amount of the cash sum will be advised to you on request and after a medical certificate has been provided. Note that if you take this cash sum the full widow(er) s pension will not commence until the fifth anniversary of your retirement and the payments to your widow(er) will be limited to your widow(er) s GMP until this date. LUXFER GROUP PENSION PLAN 14

15 Inflation protection Will my pension be increased? As necessary, your Plan pension will increase each 6 April. The increase is based on the annual percentage rise in the Consumer Prices Index (CPI) over the year to the previous November, subject to the following limits: pension for Pensionable Service up to 5 April 1997: lower of CPI and 3% 1 pension for Pensionable Service between 6 April 1997 and 5 April 2005: lower of CPI and 5% pension for Pensionable Service from 6 April 2005: lower of CPI and 2.5% Pension payable to widow(er)s increase in a similar way. If you have exchanged part of your pension for a tax free cash sum (see page 11), your pension will be reduced in the following order: (1) pension accrued between 6 April 1997 and 5 April 2005; (2) pension accrued from 6 April 2005: (3) pension accrued before 6 April 1997, and the increases to your remaining pension will be calculated after allowing for the pension reduction. Your GMP is subject to statutory requirements and after State Pension Age the following applies: i) any GMP earned before 6 April 1988: no increases will be paid by the Plan: ii) your GMP earned from 6 April 1988: the Plan will pay the lower of the annual rise in the CPI to the preceding September, subject to a maximum of 3%. 1 Except pensioners who have elected, with effect from 1 October 2011, to exchange increases on this pension for a higher non-increasing pension LUXFER GROUP PENSION PLAN 15

16 Death in service What benefits are payable? Following the closure of the Plan on 5 April 2016 death in service benefits are provided through the Luxfer Group Life Assurance Plan. There is also a death benefit associated with your preserved pension (see page 19). LUXFER GROUP PENSION PLAN 16

17 Death in Retirement Will my widow(er) receive a pension? Yes. Your widow(er) will receive a pension equal to 60% of your pension, but based on the pension you would have been receiving if you had not given up any part for a cash lump sum, plus any inflation increases added to that pension since retirement. Therefore assuming the pension, before cash was taken, was 6,562 pa, the widow(er) s pension would be: 60% x 6,562 = 3,937 pa The GMP and Protected Rights elements of your widow(er) s pension are automatically payable to your legal spouse (if any). The Trustees have discretion to pay the excess pension over these amounts to any one or more of your dependants. If you wish the Trustees to consider paying a pension to a dependant you should complete a nomination form (available to download from the Plan website) and pass it to your Local Pensions Administrator. Civil Partnerships The following special provisions apply if you have registered a Civil Partnership. Your partner will be eligible to receive the part of the widow(er)'s pension described above that relates to Pensionable Service from 5 December In addition your partner will be eligible to receive a pension equal to the Widow(er) s GMP in respect of contributions from 6 April 1988, plus the pension secured at your death by the Protected Rights Fund in respect of contributions paid up to 4 December The Trustees have discretion to increase this pension to an amount not exceeding the full widow(er)'s pension described above. Payments within 5 years of retiring If you die within five years of retiring the pension payable to you will continue to be paid to your widow(er) or civil partner or other dependant until the fifth anniversary of your retirement. After that, it will change to the amount described above. Will the pension be increased? As necessary, this pension will be increased in the same way as your own pension (see Inflation Protection on page 15). Is a cash sum payable on my death? If you die within five years of retiring and no pension is payable to any dependant, a cash sum will be paid equal to the further pension payments you would have received had you lived for five years in retirement. This will be based on the amount of your pension at your date of death. A further cash sum of 1,000 will be payable when your death occurs. If you left service with a preserved pension (see page 18) before retirement, a reduced amount, subject to a minimum of 250, will be payable depending on the period of Pensionable Service you had completed. This cash sum will be paid in the same way as the death-in-service cash sum (see Who will receive the cash? on page 19). If you are older than age 75 when you die, this cash sum will be liable for tax at the special rate of 55%. LUXFER GROUP PENSION PLAN 17

18 Leaving Service The following section of the booklet applies also to employees who remain in service after 5 April What benefits does the Plan provide? If you leave you have the choice of leaving your benefits in the Plan as a preserved pension, which is revalued and payable from your Normal Retirement Date in line with the rules of the Plan, or having a transfer value paid into your new pension arrangement. How much is my preserved pension? It is calculated as in normal retirement (see page 8), based on your accrued pension at the date of leaving. Your preserved pension will then be revalued over the period to your Normal Retirement Date, or date of retirement, as required under Chapter II Part IV of the Pension Schemes Act Broadly, this means the pension will increase as follows: Pension in respect of Pensionable Service before 6 April 2009 increases in line with the rise in the Index over the period up to your Normal Retirement Date, subject to a maximum of 5% pa compound over this period. Pension in respect of Pensionable Service from 6 April 2009 increases in line with the rise in the Index over the period up to your Normal Retirement Date, subject to a maximum of 2.5% pa compound over this period. Index means, in respect of a period before 1 January 2011, the increase in the Retail Prices Index to the preceding September, and for a period from 1 January 2011, the increase in the Consumer Prices Index to the preceding September. The part which is your GMP for service before 6 April 1997, however, increases in line with the contracting-out requirements. The rate of increase, over the period up to your Normal Retirement Date, depends on the date you left service: If you left before 5 April 1997: 7.0% pa compound; If you left between 6 April 1997 and 5 April 2002: 6.25% pa compound; If you left between 6 April 2002 and 5 April 2007: 4.5% pa compound; If you left between 6 April 2007 and 5 April 2012: 4.0% pa compound; If you left on or after 6 April 2012: 4.75% pa compound. Pre 92-Members have the option to draw their preserved pension from their 60th birthday, and also to draw their pension from age 55 if the 75 year rule applies. At retirement, your preserved pension will be subject to the Longevity Adjustment Factor (see page 10). Guarantee: If it is more, your pension for Pensionable Service between 6 April 1997 and 5 April 2012 will be the pension which can be secured by your Protected Rights Fund. Note that the pension from your State Pension Age for your Pensionable Service before 6 April 1997 will be at least equal to your GMP. LUXFER GROUP PENSION PLAN 18

19 Leaving Service (cont) What other benefits do I get with my preserved pension? Your preserved pension has several other benefits attached, including: 1. The option at retirement to exchange part of your pension for a cash sum(see page 11); 2. Annual increases after retirement (see page 15), as well as revaluation before retirement as described above; and 3. Benefits on your death after retirement as described on page 17. If I have a preserved pension, what benefits are payable on my death before my Normal Retirement Date? 1. A cash sum equal to the value of your preserved pension, less the value of the following benefits payable to your widow(er) or civil partner. 2. Your widow(er) will receive a pension equal to the Widow(er) s GMP, plus for service from 6 April 1997, the pension that can be secured by your Protected Rights Fund. 3. Your civil partner will receive a pension equal to the Widow(er) s GMP, in respect of earnings from 6 April 1988, plus for service from 6 April 1997, the pension that can be secured by your Protected Rights Fund. Who will receive the cash? In general, the person or persons you have named on your Expression of Wish Form. You must remember to complete and forward to the Pensions Manager or your Local Pensions Administrator an Expression of Wish Form and also send a new form if your circumstance change, ie in the event of your marriage, birth of children or divorce (a form may be obtained from the Plan website). Whilst legally the Trustees have absolute discretion in deciding to whom the lump sum will be paid, it is their preference to follow your wishes unless there are, in their opinion, good reasons not to do so. The reasons for this are obvious - only you know how you want the lump sum paying and you cannot expect the Trustees to "second guess" your wishes. Therefore if you do not complete an expression of wish you risk the Trustees paying the lump sum to the "wrong" persons. What happens when I leave? You will receive a letter setting out your benefits. The Plan administrators will also write to you with retirement options shortly before your Normal Retirement Date. Please notify the Plan administrators of any change of address. Where can a transfer value be paid? A transfer value may be paid to a new employer s plan, providing it is willing and able to receive it. Alternatively, the transfer value may be paid into a personal pension or an approved buy-out insurance policy of your choice. If you wish to investigate this option, you will be provided with a statement of the guaranteed cash equivalent (the term for the transfer value to which you are entitled) quoting the amount which would be payable and giving instructions on how to go about exercising the option. (Requests for cash equivalents can only be made once every 12 months.) If you wish to go ahead with the transfer, you will be required to reply within three months of the date of the quotation. Further details will be provided on request to the Plan administrator LUXFER GROUP PENSION PLAN 19

20 Leaving Service (cont) How is the transfer value calculated? The transfer value is the capital value of your preserved pension. It is calculated, using instructions provided by the Plan actuary, as the amount required to secure your preserved pension allowing for market conditions at the time of transfer. The calculation takes account of appropriate assumed rates of investment return and increases in the preserved pension before and after it comes into payment, as well as life expectancy statistics. The calculation allows for all guaranteed benefits including pension increases, but not for the possibility of discretionary benefits being granted by the Trustees at the request of the Company. Guarantee The transfer value payable will not be less than twice your own contributions to the Plan (including any contributions from a previous transfer in). LUXFER GROUP PENSION PLAN 20

21 Important General Information May I assign my benefits? You may not assign, charge or otherwise dispose of your benefits under the Plan. Will the Plan continue indefinitely? Luxfer Group Limited reserves the right to amend or discontinue the Plan at any time. In the event of the Plan being discontinued, its assets would be used to provide benefits in accordance with the Rules. What happens if the Plan is discontinued? The Trustees will use the assets of the Plan to secure members accrued benefits through insurance policies. If the assets are insufficient for this purpose and the Company is able to do so, the Company will be required to make good the shortfall. If the Company is unable to make good the shortfall, the Trustees can apply to the Pension Protection Fund (PPF) to take over responsibility for the Plan benefits, although the PPF does not guarantee total insurance for members against a shortfall of benefits provided by the Plan. Does all my transferred-in service provide the same benefits? No, your benefits in respect of previous bulk transfers or individual transfers into the RILA Plan will be determined in accordance with the literature issued to you at the time of transfer. In particular, the rate at which the pension is calculated (known as the accrual rate) may be less than 1.75% and the definition of Plan Salary may differ. You should contact your Local Pensions Administrator or your LPC or GPC Representative for further information on this. What about a common-law relationship? The Trustees have discretion to pay a pension to a common-law widow(er) following your death. Alternatively, a pension may be paid to another dependant if there is no widow(er). It is important that if you have a common-law relationship you inform the Trustees in writing as well as completing an Expression of Wish Form. Notification of death Following your death, your dependants should contact the Trustees at the address shown at the front of this booklet. Before benefits can be paid, they will need to provide the Trustees with the original death certificate and copies of any marriage/dependants birth certificates, as appropriate. Do I have any say in the running of the Plan? Yes. At all Luxfer sites, Plan members elect representatives to the Local Pensions Committee (LPC), who in turn, elect the members of the Group Pensions Council (GPC). The GPC meets regularly to discuss issues affecting the Plan. Representatives are elected from the GPC to serve as member Trustees in line with the Pensions Act This system of representation makes sure that the views of Plan members are fully considered by the Trustees, who have overall responsibility for running the Plan. LUXFER GROUP PENSION PLAN 21

22 Important General Information (cont) Could there be any additional benefits from the Plan? There is provision under the Rules of the Plan for additional benefits to be granted from time to time by the Trustees, subject to the consent of the Company and appropriate arrangements being made to fund them. In particular, the Trustees will review pension increases in the light of inflation at regular intervals, subject to the consent of the Company. Where can I obtain further information? All queries regarding the Plan should be addressed in the first instance to your Local Pensions Administrator, your LPC or GPC Representative. Annual report and accounts Each year the Trustees produce a formal annual report and audited accounts which reviews how the Plan has developed over the year. It includes statements by the actuary and auditor. A copy of the full report is available on the Plan website A summary of the Trustees report will be given to each member, annually. LUXFER GROUP PENSION PLAN 22

23 Help and advice Internal Dispute Resolution As required by the Pensions Act 1995, the Plan has an internal procedure for resolving any disputes which may arise. The procedure covers disagreements between the Trustees and members, prospective members, widow(er)s and dependants. This is a two-stage process. In the first instance, you must address your complaint to the Pensions Manager, Luxfer Group Pension Plan, Anchorage Gateway, 5 Anchorage Quay, Salford M50 3XE. In normal circumstances, you will receive a full response within two months. If you are dissatisfied with this response, you will be entitled to refer the matter to the Trustees within six months of receiving it. The Trustees will then reply directly to you, where possible within two months. You can contact the Trustees at the address shown in the front of this booklet. There are also a number of other bodies who can offer help and advice. The Pensions Advisory Service Limited (TPAS) TPAS is available to assist members and beneficiaries of the Plan with any difficulties which they may have failed to resolve with the Trustees or administrators of the Plan. They may be contacted at: TPAS Ltd 11 Belgrave Road, London SW1V 1RB Telephone: Pensions Ombudsman The Pensions Ombudsman, who is appointed under section 145(2) of the Pension Schemes Act 1993, may investigate and determine any complaint or dispute of fact or law in relation to an occupational pension scheme which is made or referred to him/her in accordance with that Act. He may be contacted at : The Pensions Ombudsman 11 Belgrave Road, London SW1V 1RB Telephone: LUXFER GROUP PENSION PLAN 23

24 Help and advice (cont) The Pensions Regulator The Pensions Regulator is established to protect the benefits of members of work-based pension schemes and to promote good administration. The Pensions Regulator may be contacted at: Napier House, Trafalgar Place Trafalgar Street Brighton East Sussex BN1 4DW Telephone: The Pension Tracing Service Information about the Plan, including current and previous employers associated with the Plan and the address to which enquiries should be directed, has been forwarded to the Pension Tracing Service. The Pension Tracing Service, which is part of the DWP, helps members trace benefits from previous schemes. The service may be contacted through by going to "working, jobs and pensions" and clicking on "workplace and personal pensions". LUXFER GROUP PENSION PLAN 24