power Taking care of your loved ones - life cover at no extra charge The story continues for proposals on public sector pensions

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1 pension power JANUARY 2012, issue 31 Taking care of your loved ones - life cover at no extra charge The story continues for proposals on public sector pensions

2 Hello and welcome... Hello and welcome to the latest edition of Pension Power, your newsletter from GMPF, your staff pension scheme. We ve been holding back on putting together this Pension Power, in the hope that we would have the definitive answer on the Government s proposals for the future design of our pension scheme - the LGPS. But at the time of writing, discussions are still going on between trade unions, employers and the Government. So we ve decided to go ahead and tell you what we know so far - see page 10 for more. One of the possibilities being discussed for the LGPS - and indeed the other public sector schemes is a change to a career average scheme. On page 12 you ll find a handy guide explaining how this works compared to the current set up - a final salary scheme. Also inside we ve a summary annual report - and it really does show that your local fund - GMPF - is faring well in these turbulent financial times. Some of you may be interested to know that I ve worked in pensions man and boy. Way back in 1979 I changed from working on retirement benefits to those relating to death. One of the first cases I dealt with concerned a Mrs Smith (as I will call her) who contacted us to claim a widow s pension. She and Mr Smith had been together for decades and in buying a house together and raising a family they were a typical married couple. Except in one vital aspect: they never actually married. Consequently the lady calling herself Mrs Smith wasn t Mr Smith s widow and therefore wasn t entitled to a widow s pension. 33 years on and as well as widow s pensions, the Scheme now has pensions for widowers, registered civil partners and nominated cohabiting partners and we are still dealing with cases like Mrs Smith s, in other words, cases where people have lived together, sometimes for a long time, but there is no paperwork in place that would allow us to recognise the relationship. And just like in 1979 there is still no discretion to allow a pension to be awarded on compassionate grounds. So if you are living with someone and want them to have a pension in the event of your death, please see page 17. Entirely separate to pensions are death grants, sometimes referred to as lump sum life cover. In this case different dependants of a deceased member can put in a claim and counter-claim for the money. We have had cases where this has happened with brothers, a mother and a daughter, partner and son and so on. So if you haven t made a lump sum nomination, please see page 16. That s all from me for now - I hope you find this issue useful, All the best Ged Dale, Head of Pensions Administration. Also in this issue... Page 4: Protections after reductions in pay Page 6: Retirement planning event Page 8: Paperless communications Greater Manchester Pension Fund is administered by Tameside MBC and is part of the Local Government Pension Scheme 2 Pension Power January 2012 Pension Power January

3 PROTECTION AFTER REDUCTION IN PAY We know many local authorities in particular have been looking at their staff and how their jobs are graded. job evaluation, pay & grading, and even PARIS are just some of the terms we ve heard this called. So if you have been affected by this type of thing and have had (or are facing) a reduction in pay, there could be a knock on effect with your pension benefits. But there are various protections in place which might help. We looked at these a couple of issues ago, but briefly these are: Use actual final pay (best of final three years): so if you are pretty close to retirement when the reduction in pay happens, this could be enough to protect you. Deferred benefits: this is where you split your benefits, locking in one set of benefits to the pay before the reduction in pay, then start afresh with a new set of benefits. This option is only available with your employer s permission. Looking back in time: This is only open to people who leave or retire within 10 years of the reduction in pay. It lets you choose any three consecutive financial years in your final 13 years. We then use the average pay from that period to work out your benefits and increase the benefits in line with inflation too. There are a couple of snags though this will only happen if you ask for it, and you can only choose it at the time you leave or retire. Some members like the sound of this option, but worry they ll forget when the time comes. So if this applies to you, fill in the slip here, cut it out, and stick it on your fridge, so you ll see it every time you go into the kitchen! 4 Pension Power January 2012 PROTECTION AFTER REDUCTION IN PAY LOOKING BACK IN TIME Only available if you ask for it, & only if you leave within 10 years of the reduction in pay which is: Are you over the limit? There used to be limits on the number of years you could build up in the scheme - 40 years at 60 or 45 years at 65. These were scrapped in But two new limits were introduced at the time - the lifetime allowance and the annual allowance. The lifetime allowance puts a limit on the size of the pension pot you can have upon retirement, without paying a tax charge. And the the annual allowance limits how much your pension pot can grow each year whilst you re building up your benefits, again without paying a tax charge. These two limits are mainly an issue for high earners - or sometimes people who get large promotions, triggering too large a growth in their pension pot. Important change to lifetime allowance On 6 April 2012 the lifetime allowance will reduce to 1.5 million from the current level of 1.8 million. Despite this reduction, most people will not be affected by the lifetime allowance charge as they don t have pension savings of more than 1.5 million. Just as an example, even someone with a pension of 50,000 a year and a lump sum of 150,000 would have a pension pot smaller than the allowance, as it would be valued at 1.15 million under the lifetime allowance rules. If you think you may have already built up savings of more than 1.5 million (or may do) given that you weren t expecting the lifetime allowance to go down, you can apply for a new form of protection called fixed protection. How to apply or find out more As this isn t part of our pension scheme rules, but rather overarching tax law, it s the HMRC you need to speak to. You may also wish to seek specialist financial advice. There s all kinds of information on the HMRC website, and we ve found a particularly useful guide at: pensionschemes/lifetime-allowance/ guide.htm Pension Power January

4 Calling all members age Free retirement planning event, 2nd February 2012 When it comes to planning your retirement, one of the most important things to think about is the package of pension benefits you ll get from us - after all, for many of us, that will be our main source of income for the rest of our lives! So we re always pleased when employers run retirement planning courses, and ask us along to cover the pensions side of things. But it struck us that some employers don t offer retirement planning courses for their staff, so we ve decided to run a trial session ourselves, where staff from various employers can get Looking ahead to your retirement? Come to our free event! together and start planning ahead. We ll be running the sessions together with Prudential, our in house AVC provider - and if you think you re in the right age group, we would love to see you there. Who is it aimed at? You really are leaving it too late if you come on a course like this just before you retire - you need plenty of time to plan for what should be the longest holiday of your life. So we are deliberately aiming this at members in the 50 plus age group. That gives you plenty of time to weigh up your options and plan ahead. What will be covered? Of course most of the content will be about your local government pension - things like how we work out your benefits, different ways of retiring, and what you need to do to get your money on time! But we ll also look at more general issues such as State pensions and tax in retirement. As part of the session, Prudential will also be talking about additional voluntary contributions (AVCs) and the chance to draw these as tax free cash. But don t worry, there definitely won t be any talk of SAGA cruises and Stannah stairlifts! Date & time This first event will be held at the Britannia Country House Hotel, on Thursday 2 February We will be running sessions at three different times on the day - so you can choose between 10am, 2pm and 6pm. Each session lasts approximately two hours, and we ll even throw in a cup of coffee! This event is free of charge! There s no charge for attending this event, but spaces are limited, so places must be booked in advance. Also, we ask that if you book a place you do actually attend, or let us know if you can t, so we can offer your place to someone else. Invitations will be issued on a first come first served basis, so don t delay, book your place now! You can do this by or by phone, as shown below. Venue The venue is in the Didsbury area of Manchester, not far from the city centre. The address is: Britannia Country House Hotel, Palatine Road, Didsbury, Manchester, M20 2WG. Don t miss the boat... book your place today! Send an marked GMPF and quoting your name, daytime phone number and preferred session time to retirepru@prudential.co.uk Or call Prudential 9am - 5pm, Mon-Fri on: BOOKING DEADLINE 27th Jan Please note, as Prudential are running this event with us, they have kindly agreed to handle all the ticketing arrangements. 6 Pension Power December January Pension Power January

5 Postman Pat winds down Pension schemes like us have to follow all kinds of rules & regulations. One of these is the catchy sounding Disclosure of Information Regulations. These require us to tell members like you about any changes to your pension scheme. In the past the rules said we had to tell you in writing so that s why for years we have produced things like this Pension Power newsletter in print and mailed them to you. But the Disclosure Regulations have now joined the 21st century and allow us to inform you by as long as you are happy with this method. If you re happy to go paperless... We already have addresses for many members perhaps because you recently joined, or if you ve signed up for our alert service. So if you re confident we have your preferred address, do nothing, and next time Pension Power comes out, you ll simply get an link to an online version. If you don t think we have your preferred address, simply go to our website at org.uk, and follow the link to paperless communications. Good for us & good for you If you go for the paperless option, there are several benefits... You ll be able to get a copy quicker - no postman to wait for Fewer printed copies is good for the planet And we save the cost of the postage - and that s actually higher than the cost of printing it! And don t worry that this option will clog up your inbox - we won t send you the actual PDF - just a link to where you can find it on our website. Postman Pat - not quite being pensioned off, but winding down a little! It won t be right for everyone We know reading Pension Power online won t suit everyone - it might be that you prefer traditional reading materials, or perhaps you ve got a slow computer. So we will still send you a paper copy if you prefer - see the box below for more about what you need to do to choose this option... Never miss a copy With all this talk of far reaching changes to all the public sector pension schemes, there s never been a more important time to keep abreast of things. So whether you read it in print or online, make sure you never miss a copy of Pension Power! And by the way, although this article mainly covers Pension Power, we may also use the same mailing preferences for other communications, for example benefit illustrations. If you prefer paper & ink... If we DON T have your address, we will continue sending you a paper copy, so you need do nothing. If we DO have your address, but would prefer to receive a paper copy, please fill in the coupon below, or visit our website at and follow the link to paperless communications. Please note that I prefer to continue receiving paper communications: Name: National Insurance number: Employer: Return to: GMPF Post & Scanning Team, Concord Suite, Manchester Rd Droylsden, M43 6SF. 8 Pension Power January 2012 Pension Power January

6 The story continues with proposals for public sector pensions Back in November last year, the Government published a paper Public Service Pensions: good pensions that last. The paper set out its views on public sector pensions, and provided an update on the progress of discussions with employers and trade unions. In this article we summarise what was in that paper, and some further developments since then... The Government believes it is possible to redesign the major public sector schemes in such a way that they... Ensure a good level of retirement income for staff, with a reasonable degree of certainty Are affordable and sustainable with controls over costs & risks Provide a fair balance of cost and benefits between public sector workers and taxpayers Protect those closest to retirement Stand the test of time no more reform for at least 25 years. You can find the full paper at: Key proposals from November paper Overall scheme design: The Government s preference is for a career average scheme rather than a final salary scheme as we have now. In a career average scheme, after each year in the Scheme, you would build up a portion of that year s pay in pension benefits. This would then be held by us and increased in line with national earnings each year until you draw it. See page 13 for more about career average schemes. Comment: for many members a career average scheme could provide similar benefits to the current final salary scheme. But of course that all depends on what pension build up rate is applied. People who tend to fare less well in a career average scheme as compared to a final salary scheme are those who enjoy substantial career progression, especially towards the end of their careers. Past benefits: For those in final salary schemes [like employees in the LGPS] what we have built up so far when any new scheme comes in will still be linked to our final salary. 10 year protection: for staff who are 55 or over by 1 April 2012, there will be no change to when they can retire, nor any decrease in the amount of pension they will get at normal retirement age [65]. Full inflation proofing: once in payment, pensions will go up each year in line with inflation [the CPI] as we have now. Retirement age: Normal retirement age is currently 65 in the LGPS. Another Government proposal is to tie this in with State pension age, where this is later than 65. Contributions: The November paper had proposed increases in member contributions, but fresh proposals suggest a way round this - see below. Literally as Pension Power was on its way to the printers, there was a fresh announcement from the Government. We understand the latest proposals to be as follows: The new look LGPS will be in place by 2014, so there will be no major changes before then, such as the contribution increases which had been proposed The new scheme will be career average rather than the current final salary There may be no need for employee contributions to rise as long as the overall cost of the scheme can be kept within limits set by the Government. Comment: this could impact on the pension build up rate. There may be some element of choice within the new scheme perhaps offering a low cost, lower benefit based package to encourage new members to join Retirement age will be linked to State pension age. STOP PRESS 10 Pension Power January 2012 Pension Power January

7 Separate rules for separate schemes Remember, whenever you hear the phrase public sector pensions, that actually refers to a cluster of separate schemes, with the rules for each written by separate Government departments. For example we are in the LGPS, with our rules written by the DCLG [Department for Communities & Local Government]. The LGPS is totally separate to the other schemes, such as the Teachers scheme. As part of the changes, each scheme has had its own cost ceiling for employer contributions set - and in the case of the LGPS the figure is 10.9% of pay. The difference between career average and final salary schemes TOTAL MEMBERSHIP x FINAL PAY BUILD PENSION x RATE UP = Summary So the latest proposals offer a career average scheme, good protection for those within 10 years of retirement, but later retirement for many members. Whilst it s good news that employee costs may be kept frozen at present rates, the trade off may be a less generous pension build up rate. And finally, please remember, this article is based on general proposals by the Treasury - what really matters for the LGPS is how the DCLG translates these into actual Regulations. In a final salary scheme, we add up how many years membership you have built up, then use this with your final pay to work out your pension: TOTAL PENSION In a career average scheme, you build up a little pension pot each year - it s literally a portion of your pay for that year. That s then banked and gets an earnings linked increase each year. The next year, you build up another little pension pot, which is a portion of your pay for that year, and so on. At retirement we add the final pensions from all the years together to get your total pension... YEAR 1 YEAR 2 YEAR 1 PAY YEAR 2 PAY x PENSION BUILD UP RATE = YEAR 1 PENSION POT BUILD PENSION x RATE UP YEAR 2 = PENSION POT PLUS EARNINGS INCREASE PLUS EARNINGS INCREASE And so on down the years... Then we add the final pensions from all the years together to get your total pension... = YEAR 1 = FINAL PENSION YEAR 2 = FINAL PENSION What s not clear at this stage is what the pension build up rate would be in a career average LGPS - but this example is based on a rate of 1/60th. 12 Pension Power January 2012 Pension Power January

8 GMPF online service now open to all We have had a service called GMPF ONLINE for our pensioner members for some time, and we are now pleased to be rolling it out to all members like you. GMPF ONLINE is a secure and interactive service that allows you to log into a user friendly version of your pension records online. Here s what you can do with it... As a member you can... See a simplified version of your pension records Tell us about any changes in your home address, telephone number or address Download and print a lump sum nomination form Contact us with a direct query Do your own benefit projections To find out more and see a demonstration of GMPF ONLINE in action There is a tutorial on our main website at www. gmpf.org.uk which offers a visual guide to getting started with GMPF ONLINE, which is ideal for new users. Just click the GMPF ONLINE link on the homepage to find out more. How do I register for GMPF ONLINE? Visit our main website at and just click the GMPF ONLINE link on the homepage to register for this free service. And once you re all signed up, use the link to the same page to log in. 14 Pension Power January 2012 Pensions - it s not rocket science... But if you think it is why not invite the team which brings you Pension Power to come out to your place of work to run the ever popular Pensions Roadshow? All you need is a group of 20 or more, a suitable room to meet, and of course permission from your employer. To find out more, call Malcolm or Simon on: And don t forget, Pensions Officers or HR teams can call us to arrange employer wide sessions too. Remember 1972? The year Jesus Christ Superstar made its West End debut, Japanese motorbike manufacturer Honda entered the car market with its Civic, and widows pensions became free of charge in the LGPS. The fact widows pensions were only free of charge after 1 April 1972 has implications if you are a man who was a member before that date, and you have ever been married. It means your membership before April 1972 will count for less, unless you have paid extra to cover it. The reduction won t apply if you have told us you are single. But if you have been single then get married, do please remember to let us know. Pension Power January

9 Putting your house in order There are some subjects which we re just not very good at thinking about - and what will happen if we die definitely falls into this category. That s probably why most of us think it would be a good idea to write a will, but haven t actually got round to doing it. But even without going the whole hog and writing a will, there are two very simple things you can look at in terms of your death benefits from us, to put your house in order. Briefly there are two types of benefits we pay out when one of our members dies in service and these are: One off lump sum We will always pay out a lump sum if you die - and then we will pay pensions to people the Scheme rules define as being dependants - more about both of these in this article. The one off lump sum This lump sum life cover is worked out by taking your yearly pay and multiplying it by three. So if you re on 20,000, that s 60,000 paid out as a lump sum if you die. You can tell us who you would like this to go to by filling in a lump sum nomination form. You can name friends, family, and even organisations, for example charities - the choice is yours. FAQs Do I have to fill in the form? No, but we will then normally just pay it to your estate Pensions for your dependants Here are the various types of dependant... Husband or wife or Civil partner or Nominated Cohabiting partner Can I change my mind? Anytime you like - just fill in a new form. Pensions Where can I get a form? for + dependants You can download one And finally - do think about your own personal from our website at or call our helpline on lump sum life cover nomination form AUG 2008 If you re married or in a same sex civil partnership, your other half is automatically classed as a dependant, and you don t need to tell us about them at this stage. If you die they will become entitled to a pension automatically. But do watch out if you are living with someone - a cohabiting partner as we call this. We can only pay them a pension if you register their details with us, by filling in a nominated cohabiting partners form. plus Eligible children FAQs Who can I register as a cohabiting partner? You must have lived together for at least two years and it must be someone with whom who could form a civil partnership or marry. APRIL 2008 Pensions for cohabiting partners nomination form What if I don t fill in the form? Then we definitely cannot pay your cohabiting partner a pension! Where can I get a form? You can download one from our website at org.uk or call our helpline on circumstances - what s right for one member isn t right for another. So a word of warning... nominations for cohabiting partners don t relate to lump sums, and nominations for lump sums don t relate to cohabiting partners. So if you want to nominate your partner for a pension and for your lump sum, you need to fill in both types of nomination form! 16 Pension Power January 2012 Pension Power January

10 Help! I m now classed as part time We know that in the past employers have classed many jobs as full time - very often in the field of education - as long as you were doing 32 hours a week. So that affects jobs like nursery nurses and classroom assistants. Now as part of pay & grading, job evaluation etc, many employers have reclassified these roles as part time. We ve had some calls from people in these types of jobs wondering whether that affects their pension benefits - here s how it works out... Under the pension scheme rules, you re part time if you work anything less than the full time hours for your authority - and this affects both your pay & membership for pension purposes. Take the example of Jane who works 32 hours a week for her employer, where the full week is 36 hours. She has been reclassified as part time from This means... Jane has 10 years membership before This is on our records as full time - so we won t go back and change that By the time she retires she will have another 20 years membership, but we now quite rightly class this as part time. So this is adjusted in line with working 32 hours, meaning 12 months now counts as roughly 101/2 months Her actual part time pay is currently 18,000. But when she leaves we will use the full time equivalent pay to work out her benefits - over 20,000 in today s money So as you can see, her old membership stays as full time - only her new membership is rounded down. And when you combine that with the higher pay we use to work out her benefits, her pension is actually bigger by a few hundred pounds in today s money. Of course if her employer had actually reduced her pay as well as reclassifying her, that could give a different picture, and she might then want to look at the various pension protections in place (see page 4). New pay bands from April 2012 As you probably know, the amount you pay into the scheme is based on a series of pay bands, with your level of pay deciding your percentage contribution - anywhere from 5.5% to 7.5%. This has been the position since 2008, and when those rules came in, the Government said they would increase the bands each April in line with prices, to prevent someone who just gets an ordinary annual pay increase getting bumped up into a higher band. This is what has happened so far, and we expect the same thing will happen next April. They actually do this by increasing the bands in line with the Consumer Prices Index (CPI), then rounding them down to the nearest 100. Based on the latest inflation figure of 5.2%, this will mean the following new bands: Band Yearly pay Contribution 1 Up to 13, % 2 More than 13,500 and up to 15, % 3 More than 15,800 and up to 20, % 4 More than 20,400 and up to 34, % 5 More than 34,000 and up to 45, % 6 More than 45,500 and up to 85, % 7 More than 85, % And remember, if you re part time, it s the full time equivalent pay which sets which band you fall into, but you then pay the relevant percentage of your actual part time pay. 18 Pension Power January 2012 Pension Power January

11 This summary report is based on information taken from our full Report & Accounts for the year to 31 March Top 20 equity holdings These are exceptional times - exceptional for LGPS scheme members, their employers and for us as the administering authority. The UK economy is struggling to return to growth, and the reductions being sought in public expenditure have both an economic impact, and a material impact on scheme members, employers and GMPF. In spite of this we have had a steady year, and excellent long term returns. 301m 114m 258m 255m 110m 103m 239m 102m A steady year and excellent long term returns The value of GMPF has increased to over 11 billion - a new high from 10.4 billion last year, and a return of 6.4%. This is a satisfactory return given the position of the worldwide economy. Looking at our longer term performance, over the last 10 years, GMPF s return has been 6.3% compared to the local authority average of 5.4%. It is this strong investment performance that has supported the funding level. To set this outperformance in context 1% on investment returns will broadly equate to the total value of employee contributions in the current year. Funding issues The most recent actuarial valuation was concluded in March 2011, and I am pleased to report that we had maintained a funding level of 96.4% as a whole. This was in part due to GMPF s strong relative investment performance - a respectable 3.3% per year (compared to the local authority average of 1.7%). This meant that overall this was a very good valuation for GMPF, with the funding level being amongst the best of LGPS funds and average employer contributions being at the lower end of the range. Membership changes The number of employee members has reduced significantly this year, and this trend is set to continue. Some of the causes include, pressures on employer budgets leading to record levels of retirements, others leaving through voluntary severance and redundancy and also members deciding to opt out, often due to personal financial pressures. With the help of the Actuary, we will be looking at the impact of the membership changes on GMPF as a whole and some individual employer case studies. This type of work will become increasingly important for employers and for GMPF as options are examined to manage volatility and maintain affordability. Conclusion These are tough times, but GMPF s excellent long term track record, relatively high funding level and relatively low employer contribution rates put us in a comparatively strong position. Peter Morris, Director of Pensions 99m 53m 41m Marks & Spencer is one of the UK s leading retailers. It sells high quality, great value clothing and home products as well as outstanding quality food. Around 21 million customers visit its stores each week and it has 78,000 employees across the UK and 42 territories globally. 75m 51m 37m 61m 49m 36m 60m 45m 36m 20 Pension Power December January Pension Power January

12 Management arrangements Total Main Fund 10,665 million Internally managed 1,505 million Externally managed 9,160 million Cash & Private Equity Property 959 million 546 million Securities Portfolio UBS 5,235 million Securities Portfolio Capital 1,697 million Securities Portfolio Legal & General 2,216 million Property Venture Fund GVA 12 million Benchmark asset allocation Equity/non equity split Non equity split UK/overseas equity split Overseas equity split EQUITIES 65% NON EQUITIES 35% UK INDEX LINKED 8.3% OVERSEAS INDEX LINKED 4.0% UK GOV T BONDS 13.1% OVERSEAS GOV T BONDS 8.3% UK CORPORATE BONDS 17.7% OVERSEAS CORPORATE BONDS 2.3% CASH 17.7% PROPERTY 28.6% UK EQUITIES 50% OVERSEAS EQUITIES 50% EMERGING 10.0% PACIFIC 12.5% JAPAN 17.5% EUROPE 30.0% NORTH AMERICA 30.0% 22 Pension Power January 2012 Pension Power January

13 How we performed And here s the Fund s result from the various types of investments - our returns. The graph below shows our returns from each type of investment, compared with the market (in other words average returns for that type of investment). And the graph below compares our returns with other local authority pension funds like us. Net assets statement as at Note 31 March March April UK equities 11 2,544,174 2,480,650 1,743,236 % % INVESTMENT RETURNS Year ended 31 March 2011 GMPF Market UK EQUITIES OVERSEAS EQUITIES UK GOV T FIXED INTEREST OVERSEAS GOV T FIXED INTEREST UK CORPORATE BONDS OVERSEAS CORPORATE BONDS PENSION FUND RETURNS WM Local Authority Survey - Financial years to 31 March GMPF Local Authority Average *1 st *1 st *4 th *5 th *25 th *93 rd Duration (years) UK INDEX LINKED 8.2 OVERSEAS INDEX LINKED PROPERTY *GMPF s percentile rank within Local Authority funds CASH/OTHER Overseas equities 11 2,428,792 2,163,797 1,516,139 UK fixed interest corporate bonds Overseas fixed interest corporate bonds UK fixed interest government bonds Overseas fixed interest government bonds UK index linked government bonds Overseas index linked government bonds , , , , , , , , , , , , , , , ,632 49, ,814 Property , , ,216 Derivative contracts 11 4,531 2, Pooled investment vehicles 11 3,203,877 3,063,886 2,606,938 Cash and deposits , , ,680 Other investment assets 11 78, ,062 56,941 Investment assets 11,045,012 10,688,404 7,783,402 Derivative contract liabilities 11 (155) (1,580) (347) Other investment liabilities 11 (47,218) (261,341) (35,810) Investment liabilities (47,373) (262,921) (36,157) Current assets 11 24,799 26,636 22,203 Current liabilities 11 (10,028) (7,357) (7,884) Net current assets 14,771 19,279 14,319 Net assets of Fund 11,012,410 10,444,762 7,761, Pension Power December January Pension Power January

14 How the figures add up... Here you will see how much members and employers paid in, compared with how much was paid out in benefits. After other payments in and out, the amount available for investing was 155 million. Income ( millions) Employees contributions 123 Employers contributions 299 Transfers in (Individual) 16 Income from investments 237 Total Income 675 Expenditure Benefits paid out 458 Investment & administration costs 15 Transfers out 47 Total expenditure 520 Money available for investment 155 Striking the right balance We ve been asked by several members recently what the effect would be on their pension if they took part in the recent one day strike, so we thought we d cover this topic here If you go on strike, you re not being paid for that day, so of course you re not paying pension contributions for that day either and this does have a small impact on your pension benefits. Here s how We use two key things to work out your pension benefits your membership and your final pay normally your pay close to retirement. So the first thing to note about a strike break is that your membership will be ever so slightly reduced as a result. But don t worry the numbers involved aren t that big! Say you re on 20,000 a year, and you took part in the one day strike, in today s money losing one day s membership would reduce your yearly pension by less than 1. Avoiding the break You can of course choose to avoid the break by paying a pension contribution for the strike period but it costs you 16% of your pay, which is much more than your standard contribution. So many people feel this isn t worth the extra cost. But if you do want to pay the extra, you must let your employer know in writing within 30 days of resuming work (although they have the discretion to extend this period). What about pay? We ve also had some members worrying that if the strike break falls in their final year, we will only count 364 days pay towards their final pay. What we will actually do however is use 364 days that has then been rounded up to a full year s pay. You can download a PDF version of the full Report & Accounts for the year to 31 March 2011 from our website, 26 Pension Power January 2012 Pension Power January

15 Can we help you? Here are the ways you can find out more or get in touch with us. If you do contact us, please quote your National Insurance number. Please let us know if you move house or if this didn t come to the right address... Visit our website to find out more or to contact us by Or call our friendly helpline on: Or call in at our offices: GMPF, Concord Suite, Manchester Rd, Droylsden, M43 6SF.