THE METAL BOX. Your toolkit to building your benefits

Transcription

1 THE METAL BOX PENSION SCHEME DC SECTION Your toolkit to building your benefits

2 HOW THE DC SECTION WORKS Even if you re early in your career and retirement is a long way off, it s important to start planning ahead to provide an income for when you stop working. The more you plan for your retirement now, the less you ll have to worry about it later. Membership of the DC Section is one of the most valuable benefits for employees. Here s a brief guide to how the DC Section works: The Trustee sets up a Personal Account for you. You can choose how much to pay into it. Your Personal Account is invested. You can decide how to invest from the range of funds available. Personal Account You receive tax relief on your contributions. Personal Account The Company also makes contributions to your Personal Account each month: these are called Matching Credits and Extra Credits. 2

3 4 When you retire, you use the value of your Personal Account to buy your benefits. You can choose a pension (also called an annuity) and whether to take a tax-free cash sum. You can also buy benefits for your Spouse, Civil Partner or Dependants. 5 You will also be eligible for valuable benefits if you become too ill to work (subject to Trustee approval) or die in service. JOINING START MAKING PLANS Personal Account This booklet has details on your DC Section benefits. Visit the website for an overview of the DC Section, and the relevant booklets and forms you might need. 3 3

4 JOINING Start making plans All employees can join. Eligible Employees are automatically enrolled at the 1% entry level. Other employees can join if they haven t been automatically enrolled or have previously opted out. You can choose how much to contribute and how to invest your savings. You can opt out at any time. 4

5 Who can join? You can join if you are a full-time or part-time employee of the Company. If you are an Eligible Employee... you will be automatically enrolled in the DC Section. Depending on whether you are a weekly or monthly paid employee, your membership will start on: Monthly-paid employees... The 1st day of the next month from your employment date or the date you become eligible, if later Weekly-paid employees... The 1st day of the 12th week from your employment date or the date you become eligible, if later The Government sets the criteria for Eligible Employees. We will write to you before your enrolment to confirm whether you are an Eligible Employee or not. Alternatively, you can visit our website for more information. JOINING START MAKING PLANS If you are an Eligible Employee and you have chosen not to join before... you will be automatically enrolled and you will be advised by letter. If you are not an Eligible Employee... you can still join and start building benefits. Contact your HR Department for details on how to join. 5

6 What happens when I am automatically enrolled? Your 1% contribution know as an Entry Level Contribution will be taken directly from your Pensionable Pay each month and invested in your Personal Account. These deductions are made before tax, which means the cost to you is less than you might think (see the Contributions section for more details). Your Personal Account will be automatically invested in the Lifestyle option (see the Investment Guide for more details). If you are an Eligible Employee, you will have been sent a Contribution Choices form and an Investment Choices form. Simply complete these if you want to increase your contributions which will build your savings quicker and/or to make your own investment choices. You can also download these forms from the Scheme website If you have any queries, your HR Department will be happy to help you. Do I have to join? No, if you don t want to be a member you can opt out. If you are eligible for automatic enrolment, you cannot opt out before you are automatically enrolled. If you opt out and do not rejoin, current pension regulations mean that the Company will need to automatically enrol you every three years if you are an Eligible Employee. If you are automatically enrolled again, you will be able to decide again if you want to stay in or not. If I opt out, can I rejoin later? Yes, simply write to your HR Department and ask to rejoin. You can then start building savings for the future again. 6

7 How do I opt out? Complete and return an opt-out form, available from Equiniti (contact details on page 40). Remember, you cannot opt out before your membership begins. If you have been automatically enrolled and opt out within the statutory opt-out period indicated in your Membership Confirmation letter, you will be treated as if you had never joined. You and the Company will stop contributing to the DC Section and your contributions will be refunded in the next available payroll run. If you opt out or leave your job after more than one month s membership, you have options about what to do with your Personal Account. See What if... I leave my job or the DC Section? on page 33. OPTING OUT JOINING START MAKING PLANS Opting out of a workplace pension scheme is an important decision. By opting out you will miss out on: Company contributions Ill-health benefits Death-inservice benefits Remember that you will still need to save for retirement in some other way and the Company will not contribute to any other pension arrangement you choose. If you are unsure what action to take, please talk to an independent financial adviser (IFA). See page 17 for how to find an IFA in your area. Can I transfer pension benefits into the DC Section? No, the DC Section currently does not accept transfers from other pension arrangements. 7

8 CONTRIBUTIONS Nailing down the costs Choose how much to contribute. The minimum contribution is 1% of your Pensionable Pay. If you make the 3% Core Contributions, you will be eligible for additional discretionary Ill-health Retirement and death-in -service benefits. The Company also contributes between 1% and 6% of your Pensionable Pay depending on your age and contribution level. The more you contribute, the more you get from the Company. Membership costs less than you think, as your contributions benefit from tax relief. 8

9 Why should I save in the DC Section? Everyone needs to save for their future and the DC Section is a great way to help you do this. Both you and the Company contribute to your Personal Account, which will be used to provide you with an income when you retire. The Company contributions are known as Matching Credits and Extra Credits, and really help to boost your savings. Think of your Personal Account like a toolbox... The contributions from you and the Company are the nuts and bolts of building your retirement savings. Personal Account You also get tax relief on your pension contributions, so the cost of membership is less than you may think. See page 13 for more details about how this works. The tools are the investment options. Investing your Personal Account should help to increase its value. CONTRIBUTIONS NAILING DOWN THE COSTS At retirement, you can start taking out the contents to provide your income in retirement. This means that you won t have to rely on the State Pension alone. 9

10 How much do I put in? It s up to you how much you contribute to your Personal Account, from a minimum of 1% of your Pensionable Pay. The more you contribute, the more you will get from the Company (up to a maximum 6%). Entry Level Contributions If you have been automatically enrolled, you will pay the minimum contribution of 1% of your Pensionable Pay each time you are paid known as Entry Level Contributions. The Company will help you to save for retirement by also contributing 1% of your Pensionable Pay, known as a Matching Credit. Core Contributions The next level is saving 3% of your Pensionable Pay called Core Contributions. Paying Core Contributions entitles you to a Matching Credit of 3% from the Company. In other words, for each 1 you pay, the Company also pays 1. You ll also have the added financial security of Ill-health Retirement and death-inservice benefits (awarded at the discretion of the Trustee). See pages 34 to 35 for further details on these benefits. 10

11 Example: Entry Level Contributions & Core Contributions Entry Level Contributions* The more you contribute, the more you get from the Company... Core Contributions 3% 1% You contribute 1% Personal Account Total saved 2% Company Matching Credit 1% CONTRIBUTIONS NAILING DOWN THE COSTS You contribute 3% Personal Account Total saved 6% Company Matching Credit 3% * At this level, you are not entitled to the salary-related death-in-service benefits or discretionary Ill-health Retirement benefits. 11

12 Extra Contributions If you pay Core Contributions, you can choose to pay Extra Contributions of 1%, 2% or 3% of your Pensionable Pay. This will bring your total contributions up to 4%, 5% or 6% of your Pensionable Pay (including your Core Contributions). If you choose to pay Extra Contributions, the Company will also contribute more this is called an Extra Credit. The amount of Extra Credit the Company provides depends on your age and the rate of Extra Contributions you pay, as illustrated below: Extra Contributions and Extra Credits Your Extra Contribution 1% 2% 3% Extra Credit from Company Age under % 0.5% 0.75% Age % 1% 1.5% Age % 1.5% 2.25% Age 55+ 1% 2% 3% How Core & Extra Contributions add up Your Total Contribution 3% 4% 5% 6% Total saved in your Personal Account with Matching & Extra Credits Age under 30 6% 7.25% 8.5% 9.75% Age % 7.5% 9% 10.5% Age % 7.75% 9.5% 11.25% Age 55+ 6% 8% 10% 12% 12

13 TAX RELIEF A handy addition to your pension toolkit is tax relief. To encourage workers to save for retirement, the Government allows tax relief on pension savings at the individual s highest rate of tax. Your contributions are made before Income Tax is deducted. So, under current tax rules, if you pay the 20% Basic Rate of Income Tax, every 1 you contribute actually costs you 80p. While for 40% Higher Rate taxpayers, a 1 contribution costs 60p. 20% Basic Rate of Income Tax 40% Higher Rate of Income Tax Cost to you 80p Tax relief Cost to you 60p Tax relief CONTRIBUTIONS NAILING DOWN THE COSTS Core Contributions Extra Contributions Tax relief Personal Account Company Matching Credit Age-related Extra Credit 13

14 Example: The benefits of Extra Contributions & tax relief Karen s Pensionable Pay is 30,000 a year, or 2,500 a month before deductions. She is a 20% Basic Rate taxpayer. Her monthly Core Contribution of 3% of Pensionable Pay is 75 and she also makes Extra Contributions at 3%, which is another 75. However, after tax relief savings of 30, the actual cost to her is 120. The Company matches Karen s Core Contribution with a 3% Matching Credit of 75. As per the Company Extra Credit scale, as she is aged 40, it also makes an Extra Credit of 1.5%, another making a total monthly Company Contribution of For Karen s total contribution of 120 a month, a total of is credited to her Personal Account. The total credited to Karen s Personal Account for the year is 3,150. Karen s Contributions Tax relief Core Contribution (3% of Pensionable Pay) Extra Contribution (3% of Pensionable Pay) % for 2013/ Actual cost per month Total credited to Karen s Personal Account a month Company Contributions Company Matching Credit (3% of Pensionable Pay) Age-related Extra Credit (1.5% of Pensionable Pay) Total Company Contribution

15 Can I pay more than 6%? Yes. These are known as Further Contributions and will help increase your savings for your retirement. However, you will not receive any Further Contributions from the Company on anything you pay over 6% of your Pensionable Pay. You will still receive valuable tax savings on all your contributions up to the Annual Allowance. You can also choose to make one-off payments at any time (e.g. if you received a bonus or a windfall). You can only contribute up to 100% of your UK taxable earnings after accounting for National Insurance and any other salary deductions. What is the Annual Allowance? The Government has set a limit to how much your pension savings can grow by (the Pension Input Amount) each year (the Pension Input Period) without incurring a tax charge. This is known as the Annual Allowance. However, as the Annual Allowance is set at a high level, it is unlikely to affect most members. You can download a factsheet with more information about the Annual Allowance from How do I change my contributions? You can change your contributions by completing a Contribution Choices form available from your HR department or, if you re a deferred member, from Equiniti. You can also download the form from the Scheme website CONTRIBUTIONS NAILING DOWN THE COSTS 15

16 INVESTMENTS Building a better future Investing your Personal Account should help your savings to grow over time. The performance of your investments will affect the value of your Personal Account at retirement, and how much pension and cash sum you will receive. Choose where to invest your Personal Account from a range of funds, which offer different levels of potential protection and growth. For less confident investors, the Trustee provides the Lifestyle option. The Self select option is available to more confident and experienced investors. Read the Investment Guide for more detailed information. 16

17 Why is investing important? The choices you make about your investments are important, as they will directly impact the value of your Personal Account when you retire. Although investment returns and the cost of buying a pension will change from time to time, the better your investments perform, the faster your savings will grow. So it makes sense for you to take an active role in deciding how your Personal Account is invested. Although you may not have made investment choices before, it doesn t have to be daunting. The Trustee has appointed Standard Life to provide a range of funds for you to choose from. You can pick one of the two strategies: Self select or Lifestyle. If you don t choose a fund, your Personal Account will be automatically invested in the Lifestyle option. Where can I get more information? The Investment Guide available from your HR Department and the Documents section of gives you more detailed information on investing and the investment funds available to help you with your choices. It also details how to change your investment choices. You can also get information from Standard Life on By law, neither the Company nor the Trustee can give you advice about your pension or investments. INVESTMENTS BUILDING A BETTER FUTURE PROFESSIONAL ADVICE If you need help with making any decisions about your finances, you might find it useful to see an independent financial adviser (IFA). The professional advice website has a search facility to help you find an IFA in your area. 17

18 YOUR BENEFITS Lining up your financial future At retirement, you use the value of your Personal Account to buy an annuity (pension) which provides you with an income in retirement. You have a number of choices to make: When to retire from age 55 onwards (age 50 if you joined before 6 April 2006). Whether to take any of your savings as a cash lump sum up to 25%. Which annuity to buy we offer an independent service to help you choose. The choices you make will affect the amount of pension you receive, so it s important to consider them carefully. Your State Pension may also provide you with some additional income. Your annuity can provide financial security for you and your family if you should die. 18

19 What benefits will I receive at retirement? Option 1 Using the whole value of your Personal Account to buy an annuity (pension). Personal Account or Option 2 Taking some of your Personal Account as a cash lump sum (currently tax free) and using the remainder to buy an annuity. If you choose this option your pension will be lower, as you have less money to buy an annuity with. Personal Account Note for option 2: Under current regulations you can take up to 25% of your pension savings as a tax-free cash lump sum at retirement. This would also include any savings you have in other pension arrangements (for example, with a previous employer). The Trustee will write to let you know how much cash you will be able to take from your Personal Account before you retire. YOUR BENEFITS LINING UP YOUR FINANCIAL FUTURE 19

20 How much pension will I get? At retirement, you use the value of your Personal Account to buy an annuity (or pension). This is an insurance policy that pays you an income in retirement. The amount of pension you receive will depend on: 1 The value of your Personal Account at retirement. This is based on: Contributions made by you and the Company during your membership Personal Account at joining Returns on the investments you have chosen Personal Account at retirement 2 How much it costs to buy an annuity. As an annuity is a form of insurance policy, the cost will vary over time in line with the insurer s prices. The cost will also vary because of: your age, health and interest rates at the time. the type of annuity you choose to buy. Due to these factors, it is impossible to predict exactly how much pension you will receive. 20 How will my pension be paid? Your pension will be paid by the annuity provider you choose. How and when it is paid will depend on the type of annuity you buy and the provider you choose. You will pay tax on your pension (the same way you do on your income now).

21 What types of annuities are available? There are a range of annuity options available and you should consider which one best suits your circumstances. The main options are listed below: Single life Provides an income just for your lifetime. Flat rate Provides a pension that does not increase each year. No pension guarantee Provides no additional benefits if you die soon after retirement. OR OR OR Joint life Provides an income for your Spouse, Civil Partner or Dependant if you die before him or her. Increasing Provides a pension that increases by a stated amount each year, for example in line with inflation. Pension guarantee Provides a lump sum if you die before a specified period. For example, with a 5-year guarantee, if you die after having retired for 2 years, your family would receive a lump sum equal to 3 years pension payments. YOUR BENEFITS LINING UP YOUR FINANCIAL FUTURE Remember, you can choose a combination of the annuity options (e.g. you could choose a single life, increasing annuity with a pension guarantee). Some options are more expensive than others and can greatly affect the cost of buying an annuity and, in turn, the amount of pension you receive. 21

22 How do I choose an annuity at retirement? Choosing an annuity can be daunting, so the Trustee offers a free retirement advice service (through an external provider). This service helps members to choose an annuity to suit their circumstances and shop around for the best price. We will send you more information as you get nearer retirement. Remember, you can only make this decision once, so it s important to consider all your options. It will affect the amount of pension you receive for the rest of your life. CHOOSE THE BEST ANNUITY FOR YOU Use our external retirement service or contact an independent financial adviser (see page 17) to help you choose the best annuity for your circumstances. When can I take my benefits? The Normal Retirement Date is your 65th birthday. This is the age we assume you ll retire, unless you tell us otherwise. KEEP YOUR TARGET RETIREMENT AGE UP TO DATE If you are investing in the Lifestyle option, remember to update your Target Retirement Age if you decide you want to retire earlier or later than your 65th birthday. (See the Investment Guide or the Investments section of for details.) 22

23 Can I retire early? You can take your benefits from age 55 You can take your benefits from age 55 (age 50 if you joined the Scheme before 6 April 2006). Remember that if you take your benefits early, it is likely that your pension will be smaller. This is because the value of your Personal Account will be lower as it will have had less time to grow. In addition, the cost of buying an annuity may be higher as your annuity provider will expect to pay you a pension for longer. You can choose to work after age 65 Can I take my benefits later? If you choose to continue working for the Company after your 65th birthday you can either: Continue to contribute to the Scheme. However, after age 75 you will no longer be eligible for tax relief on your contributions. Or Stop contributing and leave your benefits invested in your Personal Account until you want to retire. You will continue to receive any investment returns. YOUR BENEFITS LINING UP YOUR FINANCIAL FUTURE Can I take my benefits and continue to work? No. You need to have left Company employment if you want to take your benefits before age

24 Are there any limits on my benefits? There is a limit called the Lifetime Allowance. This is a Government-set limit for the maximum value of pension benefits you can build up over your whole working life before you pay a special tax charge on them. You can find details of the Lifetime Allowance at enter Lifetime Allowance in the search box. Most members are unlikely to exceed this limit, but if you think you might be affected as you approach retirement contact Equiniti, the Scheme administrator or an IFA. What benefits will I get from the State when I retire? In addition to your DC Section benefits, you may also receive a State Pension. The amount of State Pension you receive will depend on when you are due to retire, the amount of National Insurance contributions you have made and the length of time you have paid them. Your State Pension Age (the age at which you are eligible for your State Pension) will also vary depending on when you were born. 24

25 HOW MUCH STATE PENSION MIGHT YOU RECEIVE? Unless you request otherwise, from time to time information on your State Pension will be included with your annual benefit statement, which the Trustee will send you. You can also get further information from or by contacting the Future Pension Centre using the following details: Future Pension Centre, Department for Work and Pensions, Tyneview Park, Newcastle Upon Tyne NE98 1BA To find out more about State benefits and your State Pension Age, visit the GOV.UK website. YOUR BENEFITS LINING UP YOUR FINANCIAL FUTURE 25

26 TOOLS Measure your progress However long you have until retirement, drawing up some plans now will help. The value of your Personal Account at retirement will depend on the choices you make. To help you make the right choices for you and get the most out of your membership, we provide you with helpful tools including: a personalised annual benefit statement the website an online pension modeller. 26

27 Planning out your future Planning for your retirement may seem an overwhelming task, especially if it s a long way off. However, spending some time doing it now can make a real difference to the benefits you ll receive and usually means you ll have less to worry about later. It isn t as complicated as it sounds and we provide you with some helpful tools. Your personalised annual benefit statement Every year, the Trustee will send you a personalised benefit statement. This provides an annual update of how your Personal Account is building up. In your benefit statement you ll find a personalised estimate of the pension you could receive at retirement. From time to time, we will also send you a State Pension forecast. These figures will help to give you an idea of whether you are on course for the income you want at retirement. Your benefit statement also includes a reminder of the funds you invest in and shows their performance over the year. You can use this information to review your investment options and make sure they are still right for you. TOOLS MEASURE YOUR PROGRESS WILL YOUR PENSION BE ENOUGH? After receiving your benefit statement, if you don t think your pension will be enough you could consider increasing your contributions to boost your savings. Use the pension modeller at to see the effect increasing your contributions could have on your potential income at retirement. 27

28 The website This website provides the information you need as a member. It will help you make the most out of your Company pension and build a better income for your retirement. On the website you ll find the following sections: MODELLER CONTRIBUTIONS This explains the levels of contributions you can make to the DC Section and the Company s contributions. THE BENEFITS This useful tool shows you a breakdown of how your Contributions, the Credits and tax relief add up (see page 29). DOCUMENTS Here you can find out about the benefits you can buy with your Personal Account at retirement. This section also provides details of State benefits. The documents and forms you might need are available in this area. INVESTMENTS Making investment choices is important. This section helps you understand investing and the range of funds available. Find out what would happen to your savings if you were to have a service break, become ill, die or leave the Company. WHAT IF? 28

29 Online pension modeller This simple tool allows you to model your retirement benefits to see how the choices you make impact your potential income at retirement. By inputting a small amount of information about you, it will provide you with a personalised pension forecast. Using information from your most recent benefit statement will provide you with more accurate figures. There are two parts to the modeller: You can use the sliders to see the effect of changing your retirement age, contribution rate and potential investment returns. The Pension Calculator Here you ll see how much pension and tax-free cash you could receive. MODELLER The Contribution Calculator Here you ll see how your Contributions, the Company Credits and tax relief all add up. Move the sliders to see the actual cost to you of different contribution rates and how much you ll receive in Company Credits. TOOLS MEASURE YOUR PROGRESS This helps you to make choices about when to retire and how much you need to pay to achieve the income you want in retirement. You can also use the modeller to see how pay changes affect your future benefits. This helps you to make a choice about the right contribution level for you. 29

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31 Where can I get further advice about financial planning and retirement? By law, neither the Company nor the Trustee can give you advice about your investment options or the type of annuity to choose. If you need help with making any decisions about your finances and planning ahead, the Trustee would recommend consulting an independent financial adviser (IFA). Visit to find an adviser in your area. Remember to ensure that anyone you speak to is properly qualified and be aware that they may charge for their services. MANAGING YOUR BUDGETS You can find help on managing your budgets and financial planning for retirement through online resources, such as: The Money Advice Service The GOV.UK retirement guide TOOLS MEASURE YOUR PROGRESS 31

32 WHAT IF? Protecting you and your family Use this section to help answer some of the questions you may have. If you have a question that isn t covered here, contact Equiniti (details are on page 40). The questions covered in this section are: What happens to my pension if I have a break in service? What happens if I leave my job or the DC Section? What if I have been automatically enrolled and opt out immediately? What if I become too ill to work? What happens if I die while working for the Company? How do I let you know who I want to receive any benefits in the event of my death? What happens if I die after I retire? What about if I die after leaving the Company, but before retirement? What happens to my benefits if I get divorced / dissolve a civil partnership? 32

33 What happens to my pension if I have a break in service? It will depend on the circumstances of the service break as to what happens regarding your contributions. The Company considers two types of service break: Family Leave During paid Family Leave, your contributions will continue and will be based upon your actual earnings during that time. The Company will continue to make any Matching and/or Extra Credits on your contributions. Approved unpaid leave If you have a period of absence for which you do not receive Pensionable Pay (e.g. child care leave), you should contact the Scheme administrator Equiniti if you are thinking about making contributions. WHAT IF? What happens if I leave my job or the DC Section? If you leave the Company and /or you no longer contribute, you have the following options: Leave your Personal Account invested until retirement. You will then be known as a Deferred Member, as you will no longer be able to contribute and your benefits will be deferred until you retire. Receive a refund of your contributions, less tax. This option only applies if you have less than 2 years Pensionable Service. Transfer the value of your Personal Account to another registered UK pension scheme or certain overseas schemes. You don t need to make a decision straight away about a transfer. You will also no longer be eligible for the discretionary ill-health or salary-related death-in-service benefits. What if I have been automatically enrolled and opt out immediately? If you opt out within the statutory opt-out period (detailed in your Membership Confirmation letter ) you will be treated as never having been a member, and both you and the Company will stop contributing. Your contributions will be refunded in the next available payroll run. 33

34 What if I become too ill to work? If you are ill, in most cases you may only be absent for a short time. Your contributions together with Company contributions to your Personal Account will not be affected. However, if you become seriously ill or unable to work due to injury, the Trustee may use its discretion to allow you to take Ill-health Retirement and award you an Ill-health Retirement pension. This benefit is not available if you pay Entry Level Contributions. There are two Ill-health Retirement categories: Unable to carry out normal duties This applies if your health fails to the extent that, whilst not fully incapacitated, the Trustee considers that you are unable to carry out your normal duties now and in the future, and there is no suitable alternative employment available within the Company. Provided you have completed at least five years contributory membership at Core Contributions or above, you will become entitled to an immediate pension equal to: 1/200 x Final Average Earnings x prospective service from the date of your Ill-health Retirement to age 60. Permanent Incapacity This applies if you retire due to injury or illness and the Trustee considers you to be permanently incapacitated and prevented from following any form of paid employment. You will be paid an immediate pension from the Scheme equal to: 1/100 x Final Average Earnings x prospective service from the date of your Ill-health Retirement to age 65. If you are awarded a discretionary Ill-health Retirement pension as described above, you must also use your Personal Account to buy an annuity. Depending upon the nature of your illness, you may be able to obtain enhanced annuity terms. You may take some of your Personal Account as a tax-free cash lump sum. 34

35 What happens if I die while working for the Company? The benefits described below will become payable. If you are paying Entry Level Contributions, only a lump sum of the value of your Personal Account is payable. WHAT IF? If you die before age 65 If you die after age 65 A lump sum of the greater of: 3 x your Pensionable Pay in the previous Scheme year, or 3 x your Final Average Earnings at the date of your death; plus The accumulated value of your Personal Account; and A pension for your surviving Spouse or Civil Partner, calculated as: 1/200 x Final Average Earnings x prospective service from the date of your death to age 65. A lump sum of the greater of: 3 x your Pensionable Pay in the previous Scheme year, or 3 x your Final Average Earnings at the date of your death; plus The accumulated value of your Personal Account. If you don t have a surviving Spouse or Civil Partner, the Trustee may use its discretion to award a Dependant s Pension to someone who, in its opinion, was wholly or mainly financially dependent on you at the date of your death. 35

36 How do I let you know who I want to receive any benefits in the event of my death? You can let the Trustee know who you would like to receive any death benefits by completing a Nomination for Lump Sum Death Benefit form. In addition, the Trustee may also award a Dependant s Pension to someone other than a Spouse or Civil Partner. You can let the Trustee know who you would like to receive any Dependant s Pension by completing a Nomination for Dependant s Pension form. Submitting these forms ensures that any death-in-service cash lump sums can be paid free of Inheritance Tax, as the Trustee has total discretion on who will receive the payment. Both these forms are available on request from your HR Department, Equiniti, or to download from If you are legally married or in a registered civil partnership, and wish to nominate someone else to receive a Dependant s Pension, please contact the administration team at Equiniti for further information. If your surviving Spouse, Civil Partner or Dependant is more than 10 years younger than you, the Spouse s/dependant s Pension will be reduced by 2½% for each year or part year by which the age difference exceeds 10 years, with a maximum reduction of 50%. LET US KNOW IF YOUR CIRCUMSTANCES CHANGE The Trustee recommends that you update both of these forms when your personal circumstances change (for example, if you have a child, get married or get divorced). 36

37 What happens if I die after I retire? If you die after retiring, the benefits payable will depend on the options you have selected at the time you retire. These will be provided by the annuity provider and not the Scheme. For example, if you choose a Joint life annuity, this will provide a pension for your Spouse, Civil Partner or Dependant if you die. If you choose a Guarantee Period and you die within this time, it will pay out a lump sum of the remaining years payments to your beneficiaries. WHAT IF? What about if I die after leaving the Company, but before retirement? If you have kept your benefits invested as a Deferred Member, the value of your Personal Account will normally be paid as a lump sum. No benefits would be payable if you had transferred your DC Section benefits to another arrangement. What happens to my benefits if I get divorced/dissolve a civil partnership? Your benefits under the Scheme may be affected if you get divorced or dissolve a civil partnership. For example, you and your Spouse s (or Civil Partner s) pension benefits must be taken into account when your joint assets are calculated. Further information is available from Equiniti. 37

38 WHAT ELSE DO I NEED TO KNOW? Finishing touches The Trustee runs the Scheme according to the legal Trust Deed & Rules that govern it. The Trustee has to act in the best interests of all the members and their dependants. The Trustee has a formal procedure in place to deal with any complaints about the Scheme. A number of external organisations can help and advise you about work-based pension schemes and pensions matters. The information in this booklet is based on the Trust Deed & Rules and current legislation. Your benefits will be based on the Rules and legislation at the time you leave the Scheme, retire or die. 38

39 How secure is my Personal Account? The assets in members Personal Accounts are held separately. On your retirement or death, or in the event that the Scheme has to be wound up, the total market value of the assets in your Personal Account at that time would be applied for your benefit. The market value of the assets in your Personal Account will depend upon both how much you have contributed and how well the investment funds you have chosen have performed. The Trustee has appointed Standard Life as its provider for the DC Section. In this context, Standard Life is providing a long-term insurance policy. In the unlikely event of the insolvency of Standard Life, there are a number of factors which help to ensure that the value of your Personal Account is protected from loss. Should it be the case that a loss is ultimately incurred as a result of the insolvency of Standard Life, up to 90% of the value of your Personal Account may be recoverable by the Trustee on your behalf through the Financial Services Compensation Scheme (the FSCS). More details on the FSCS can be found at You are also able to invest in funds via Standard Life that are managed by other investment managers. If some or all of your funds are invested on your behalf by Standard Life into an insured fund of another insurance company, then should that company become insolvent, Standard Life expects to cover you for the full amount. Some of the funds are set up as mutual funds where the assets of the mutual fund are held by a custodian separately from the fund manager s own assets. This means that investors enjoy a robust level of protection in the event of default of the external fund manager. Where should I go if have any questions? If you have any queries about your benefits or how the DC Section works, you can visit the pensions website or speak to your HR Department or Equiniti. All forms and guides mentioned in this booklet can be downloaded from the website, or requested from your HR Department or Equiniti. What if I have a complaint? The Trustee has put in place a formal two-stage procedure for the resolution of disagreements which may arise. You can ask for a copy of the Internal Dispute Resolution Procedure from the Pensions Department. 39 WHAT ELSE DO I NEED TO KNOW? FINISHING TOUCHES

40 Who do I contact if I have a query regarding benefits or to update my details? You should get in touch with the administrators, Equiniti. The contact details are: The Metal Box Pension Scheme, c/o Equiniti Paymaster, Sutherland House, Russell Way, Crawley, West Sussex, RH10 1UH metalboxpensions@equiniti.com Tel: +44 (0) Who should I contact if I have a query about my investments? You can get information about the range of investment funds available to you by contacting Standard Life: Tel: Once you are a member, you can view your investments online by logging into the Employee Zone Standard Life s online investment administration system: If you don t have Employee Zone login details, contact the Standard Life helpline for access. Quote: The scheme policy number TR1050. Your Standard Life membership number, which will be on your Standard life membership certificate and benefit statement. Your employer details as Crown Packaging. How do I contact the UK Pensions Manager and Scheme Secretary? The contact details for the UK Pensions Manager and Scheme Secretary are: Mrs Cathy Aston, UK Pensions Manager catherine.aston@eur.crowncork.com Tel: +44 (0)

41 How is the Scheme run and managed? The Scheme is looked after and managed by Metal Box Pension Trustees Limited (the Trustee). Its six Trustee Directors include four nominated by Management and two nominated by members. It s the Trustee s responsibility to run the Scheme according to the legal documents that govern it known as the Trust Deed & Rules and in the best interests of all the members and their dependants. The assets of the Scheme are held entirely separately from the assets of the Company. The assets in your Personal Account are held by Standard Life and are individually attributed for your benefit. The Law Debenture Pension Trust Corporation plc has been appointed as an Independent Trustee, with a special role in the event of the Scheme being wound-up, and whose consent is required before any change can be made to the Scheme s winding-up provisions and before any new employer can participate in the Scheme. IMPORTANT INFORMATION Various specialists are appointed to assist and advise the Trustee. These include Standard Life, an Actuary to advise on the funding of the Scheme and a Solicitor to provide legal advice. A copy of the Scheme s annual report is available to download from the Scheme website or on request from Equiniti. Scheme changes Although it has no plans to do so at the moment, the Trustee has the right to make changes or close the Scheme at any time, with the Company s agreement. WHAT ELSE DO I NEED TO KNOW? FINISHING TOUCHES This booklet aims to summarise the key features of the DC Section. It is intended as a guide only and nothing in it grants any legal rights to benefits. In the event of any discrepancy with the Trust Deed & Rules the legal documentation governing the Scheme the provisions formally set out in the Trust Deed & Rules, as well as any changes in pension regulations or tax rules after September 2013, will override this booklet. 41

42 Useful Contacts The Pensions Advisory Service (TPAS) TPAS is available to give pension scheme members help or advice about their benefits. You should approach TPAS if you have an issue you haven t been able to sort out with a scheme s administrators or trustees. The Pensions Advisory Service, 11 Belgrave Road, London, SW1V 1RB Pensions Ombudsman The Ombudsman can resolve disputes or complaints about pension schemes that rest on facts or points of law. Normally, you need to have approached TPAS with your problem before the Ombudsman will take it up. Pensions Ombudsman, 11 Belgrave Road, London, SW1V 1RB The Pensions Regulator The Pensions Regulator oversees the running of pension schemes in the UK. It has wide-ranging legal powers and can step in if any employers or trustees are failing in their duties towards their schemes. It also publishes guidance and advice for scheme trustees to follow. The Pensions Regulator, Napier House, Trafalgar Place, Brighton, BN1 4DW GOV.UK This Government website contains details of State Pensions and other State benefits. It also has details of the Pension Tracing Service, which may be able to help if you have lost touch with a scheme you used to belong to (for example, a former employer s pension arrangement). Details of the DC Section are registered with the Pension Tracing Service. KEEP US UP TO DATE If you leave the Company, please tell us your new address if you move house. This means that we can keep you informed with news about the Scheme and any updates to your benefits. 42

43 Jargon buster You can also find a full glossary of terms in relation to the Scheme at Company Your employer, being a Company in the CROWN Group of Companies in the United Kingdom that participates in the Scheme. Active Member You are referred to as an Active Member while you are in service with the Company and you contribute to the DC Section. Core Contributions The first 3% of Pensionable Pay that you contribute. Credit(s) The Matching Credits and Extra Credits paid to your Personal Account. Dependant A person to whom financial support is provided by you and who is approved as a Dependant by the Trustee. Eligible Employee An employee who meets the eligibility criteria for automatic enrolment. Details of the current criteria can be found on the Workplace pensions section of Entry Level Contributions The first 1% of Pensionable Pay you contribute towards the DC Section for a 1% Matching Credit from the Company. Extra Contributions as explained on page 12. Extra Credits as explained on page 12. Family Leave Includes ordinary or additional maternity and adoption leave, parental leave and paternity leave. Final Average Earnings The average of your best three consecutive years of Pensionable Pay in the last ten years before death-in-service or Ill-health Retirement. Further Contributions Contributions of more than 6% of your Pensionable Pay. Matching Credit The Credit of 3% of your Pensionable Pay, or 1% of your Pensionable Pay if you make Entry Level Contributions, paid to your Personal Account. Pension Input Amount The total contributions made by you and the Company to the DC Section. Pension Input Period 1 April (or the date you joined the Scheme, if later) to the next 31 March each year. Pensionable Pay Your gross annual earnings taxable under the PAYE system, excluding Special Bonuses. Pensionable Service Your period of employment whilst a Contributing Member of the DC Section. Personal Account The total accumulated assets invested to provide benefits for you. Scheme The Metal Box Pension Scheme. The Scheme provides benefits through the DC Section and the DB Section. Target Retirement Age The age at which you want to retire. If you invest in the Lifestyle option and want to retire earlier or later than age 65, then you need to inform Equiniti to ensure your account is invested correctly. Trust Deed & Rules the governing documentation of the DC Section, as amended from time to time. WHAT ELSE DO I NEED TO KNOW? FINISHING TOUCHES 43

44 CONTACTS Write to: The Metal Box Pension Scheme c/o Equiniti Paymaster Sutherland House Russell Way Crawley West Sussex, RH10 1UH UK Helpline: +44 (0) For more DC Section information and relevant forms, documents and tools, visit: Data Protection Under the Data Protection Act 1998, we can only use (or pass on to our advisers and administrators) your personal details for the purposes of running the Scheme. We need to hold personal information about you such as your age, sex, marital or civil partnership status to administer your Personal Account properly. As a member of the Scheme, the Trustee, its advisers and administrators will maintain and process data about you to calculate and pay benefits, for statistical purposes, for reference purposes and to administer the Scheme. The Trustee is the data controller for the purpose of the Data Protection Act If you do not want your personal data to be used in this way, you will need to opt out of the pension scheme. You can ask to see the information we hold about you at any time by writing to Equiniti. It s also very important that you let us know if anything about your situation changes for example, if you marry, divorce, register or dissolve a civil partnership, become a parent or change your address. Contact your HR Department, who will pass on details to Equiniti. Designed and produced by Anthony Hodges Consulting Ltd 2013_3829 On behalf of Metal Box Pension Trustees Limited, the Trustee of The Metal Box Pension Scheme October 2013