Witer 2018 A Pesio Pla Report to Members o behalf of the Avo Rubber Retiremet ad Death Beefits Pla Your Pesio. Your Future. IN THIS ISSUE 2 Welcome from the Chairma of the Trustees 3 Key Facts ad Figures from 2017 4 Defied Cotributio sectio 6 Defied Beefit sectio 7-10 Latest News 11 Trustees & Pla Advisors 12 Further iformatio & Cotacts
Message from the Chairma of the Trustee Board Miles Igrey-Couter Chairma of the Trustee Board Welcome to this year s Avo Pla Trustee Newsletter. This time last year I reported that we had early completed the 2016 actuarial valuatio of the Pla s Defied Beefit liabilities. This is the process where the Trustee Board works with the Scheme Actuary ad the compay to value the assets ad liabilities of the Pla, with the aim of makig sure that the compay s future cotributios address ay deficit over time. I am pleased to report that those discussios with the compay aroud cotributio levels resulted i a sigificat icrease to the compay s cotributios towards the fudig deficit ad admiistratio costs. Details of this ad the curret fudig positio ca be foud i the eclosed Summary Fudig Statemet. We have cotiued to moitor the fiacial stregth of Avo Rubber ad its ability to support the DB sectio sice the valuatio was completed ad do ot have ay cocers. There is ope dialogue betwee the Trustee ad the Compay s ew maagemet team appoited i 2017 which will serve the Pla well as the Compay embarks o its ext phase of growth. The strategy for this was recetly preseted with the compay s 2017 results ad was reviewed by the Trustees. We expect Avo s ability to support the Pla to cotiue to improve as this strategy is implemeted. We have made two ew Compay omiated appoitmets to the Trustee Board sice the last ewsletter. Mike Harral joied Avo i 2005 ad is the Compay s Chief Techical Officer. Mike s focus at Avo has bee o product developmet o the respirator side of the busiess. Zoe Hollad is a qualified solicitor who joied Avo i 2012 ad is the Deputy Compay Secretary ad Geeral Cousel. Zoe works i the corporate office ad will shortly retur to work from materity leave followig the birth of her secod daughter. I am delighted to welcome both Mike ad Zoe oto the Trustee Board. Oe of our Member Nomiated Trustees (MNTs), David Little, retired from Avo i December after more tha 40 years service but agreed to cotiue as a MNT. The curret appoitmet terms for both of our MNTs will expire later this year ad we are ruig a omiatio process to cofirm the two MNTs from 1 October 2018. Details of this process are set out later i this ewsletter. If you are iterested i omiatig yourself as a MNT the deadlie is 30 April 2018. The day to day maagemet of the DB sectio has cotiued successfully durig the last year. We have, as usual, worked closely with our Ivestmet Cosultats at Mercer to esure the moey the Pla has ivested is deliverig the returs eeded to pay pesios ow ad i the future. We are also keepig a close watch o admiistratio service levels at Mercer followig the sharp icrease i the volume of activity across all DB schemes i recet years followig the chages made by the Govermet i 2015. There is a remider of these chages ad your rights later i this ewsletter. If you are cocered about the service you have received from our admiistrators, their member helplie details are set out o the last page of this ewsletter. Alteratively you may cotact us directly through the Pla s website. For members of our Defied Cotributios (DC) sectio, the last year has see sigificat focus o the DC sectio by the Trustees ad some improvemets, icludig a ew default fud ad icreased focus o good goverace. I take this opportuity to thak Rob Wills ad the DC Committee for overseeig this ad remid all of our DC members that they ca log oto the Stadard Life portal to see their ivestmets, access correspodece from Stadard Life ad create illustratios of your estimated pesio at retiremet. As always our website icludes a lik to this ewsletter ad other iformatio relatig to the Pla, which ca be accessed at www.avo-rubber.com/pesios. If you have ay commets about this ewsletter or the Pla i geeral, please cotact the admiistratio teams or the Trustees directly. 2 AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN
Key facts ad figures Defied Cotributio sectio members as at 31 March 2017 Percetage of assets split by ivestmet maager as at 31 March 2017 Total umber of members: Brought forward from last year 207 New etrats 31 Exits (39) 14% 8% 21% Active members o 31 March 2017 199 Deferred Defied Cotributio members with preserved pesios 106 9% 11% 24% 13% Defied Beefit sectio members as at 31 March 2017 Ex-members with preserved fial salary pesios Year eded 31 Mar 16 Year eded 31 Mar 17 1,560 1,479 BlackRock LDI fuds BlackRock Dyamic Diversified Growth Fud Pesioers 2,032 2,036 Skage Global II Fud Total 3,592 3,515 Cash Fisbury High Yield Fuds (Shekma) Summary of moey comig i ad goig out of the Pla Majedie Asset Maagemet First Eagle Year eded 31 Mar 16 (000) Year eded 31 Mar 17 (000) Value of the Pla at start of year Moey comig i less moey goig out Chage i market value of ivestmets Value of the Pla at ed of the year 325,238 306,528 (15,072) (15,072) (3,638) 52,225 306,528 343,681 Note: Moey comig i less moey goig out cosists of paymets to pesioers offset by cotributios from Avo Rubber. Over the year the assets of the Pla icreased substatially due to strog positive returs from both the shares the Pla holds i the UK ad globally, ad also due to the rise i fixed icome ivestmets both i the US ad the UK. AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN 3
Defied Cotributio sectio Beefits i the Defied Cotributio (DC) sectio are determied by a combiatio of cotributios paid by members ad the Compay ad ivestmet icome eared. The Compay pays a amout specified i the Rules that depeds o each member s chose cotributio rate. This is a valuable beefit provided by the Compay ad we wat members to be i a positio to get the best possible outcomes from this. We have partered with Stadard Life to provide a wide rage of fuds you ca choose to ivest i ad Stadard Life offer a great olie portal to access all the iformatio you might eed i relatio to your persoal beefits ad the optios available to you. For further iformatio about joiig the pesio pla, receivig tax beefits from the Govermet ad also receivig additioal cotributios from the compay you ca visit the Stadard Life Avo portal at: www.stadardlifepesios.com/avorubber GET STARTED Joiig the pesio The sooer you joi, the sooer you ll start receivig tax beefits from the Govermet - ad you will also get extra cotributios from the compay. WHAT DOES THIS MEAN FOR YOU? Pesio flexibility Everyoe has cotrol over how they take moey from their pesio. There s a miimum age after which you ca withdraw moey, but pesios are ow oe of the most tax-efficiet ad flexible ways to save for the future. YOUR PAYMENT CHOICES How much should you pay? It s up to you - as log as you meet the miimum set by the compay. But remember, payig i a little bit more ow could make a big differece whe you retire. Curret members of the Pla ca maage their pesio olie at: www.stadardlife.co.uk/1/site/employeezoe/logi 4 AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN
What ca I do olie? Whe you log o, you ca: Check your pesio value You ca see what your curret pesio value is, ad what it might be worth whe you retire. This will help you keep o track ad see if you eed to chage your paymets. Check your paymets Keep up to date with your paymets ad see if you eed to chage the amout you re payig. Review your ivestmets You ca see how your fuds are performig ad chage your ivestmets olie. Update your details Keep your persoal iformatio ad cotact details up to date so we ca keep i touch. How do I get access? Your userame ad password Oce you receive your certificate of membership, you ca register for olie servicig by clickig o the lik below. You ca log i ad maage your pesio aytime durig the followig hours: Moday to Friday, 7am - midight. Saturday ad Suday, 7am - 11pm. Get the mobile app The Stadard Life mobile app lets you: View your pesio ad ay other ivestmets you have with Stadard Life. Browse cofidetly. AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN 5
Trustee assessmet of the DC sectio The Trustee Board has spet a sigificat amout of time over the last 12 moths lookig at the operatio of the DC sectio ad cosiderig the actios we eed to take to improve the member experiece. If you have ay ideas or suggestios you feel worth our cosideratio please cotact the trustee. Followig a detailed aalysis of the Pla s membership ad o the basis of idepedet ivestmet advice from our advisors, Ao Hewitt, as of 4 October 2017 we switched the default fud from the Stadard Life Passive Plus III Uiversal Strategic Lifestyle Profile Fud (the Passive Plus ), to the Stadard Life Active Plus III Pesio Fud (the Active Plus ). We determied the Active Plus Fud offers the appropriate level of risk for our members, with greater potetial for log-term growth. It also provides lifestylig which meas that as you approach retiremet, ivestmet risk is gradually reduced by movig your fud ito deposit style ivestmets. Approximately 81% of our Pla members are ivested i the default fud. After the success of the member presetatios held at Hampto Park West last May we have decided to follow this up with aother series of briefigs; Start to Save, Makig Your Moey Go Further ad Plaig for Retiremet. We will also be offerig some oe-2-oe sessios with advisors at the same time. Further details will be released shortly. The Trustee s framework for assessig value for members is to look at ivestmet returs ad overall fud performace (o a quarterly basis) ad compare this to the charges that are deducted from members fuds. Through the Goverace Report ad the Member Outcome Report, the Trustee Directors have assessed the fud performace ad membership value i detail. With the help of our advisers, we have assessed members ivestmet returs ad overall fud performace to esure that the charges bore by the members are reasoable for the fuds offered uder the Pla. We cosidered, i particular, that higher charges i specialist fuds are usual ad i the case of the fuds we offer, justified. We have secured a rebate from Stadard Life for the Scheme, for both active ad passive fuds, of 0.71% per aum which sigificatly reduces the costs bore by the members. Based o our high level, cost based assessmet; the Trustee Directors have cocluded that the Pla represets good value for members. We cotiue to review the rage of fuds available to members havig a rage of fuds is desirable to esure members have sufficiet optios for the ivestmet actios they may wat to take. However, havig too may fuds ca be cofusig ad/or a little dautig for some members ad a big time commitmet for the Trustee i terms of moitorig these fuds. A large proportio of the fuds available are curretly ot used by our members, so i the future we ited to review these fuds with the itetio of cosolidatig across asset classes whilst maitaiig a targeted (but still wide) rage of fuds makig it easier for members to uderstad the choices they have. Defied Beefit sectio Actuarial valuatio ad fudig positio The Trustee Board is resposible for esurig that sufficiet cotributios are paid ito the Pla to cover beefits payable i accordace with the Rules ad to build up fuds to pay for future beefits. Sice the closure of the Defied Beefit sectio of the Pla i 2009, beefits i the Defied Beefit sectio are paid for by a combiatio of cotributios paid by the compay ad ivestmet icome eared The amout of cotributios to be paid is agreed betwee the compay ad the Trustee ad recorded i a Schedule of Cotributios. The Trustee Directors are advised by the Scheme Actuary who helps them agree appropriate assumptios with the compay for calculatig cotributios. Oce the assumptios are agreed the Scheme Actuary assesses the amout of moey i the Pla relative to the beefits that must be paid out, both ow ad i the future. This assessmet is kow as a actuarial valuatio of the Pla, ad is ormally carried out every three years. We carried out a valuatio with a effective date of 31 March 2016. We have icluded with this publicatio a up to date Summary Fudig Statemet which shows the fudig level at a more recet date. Ivestmet Strategy We have recetly agreed some chages to the Pla s ivestmet strategy, to esure we have a appropriate balace of seekig ivestmet returs ad reducig the volatility i the fudig positio. As a result we ivested i a ew fud i March 2017, the Majedie Tortoise Fud, ad more recetly, have reviewed our Liability Drive Ivestmet (LDI) ad Diversified Growth (DG) fuds to esure they remai appropriate for the Pla s circumstaces. 6 AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN
Latest News The Aual Allowace The Aual Allowace is the total value of tax-efficiet pesio savigs you ca make i a year. For most people the Aual Allowace is curretly 40,000 a year. If you are a high earer, you may have a lower tapered Aual Allowace. Broadly, this applies if: your icome (ot icludig pesio cotributios) is 110,000 or more; ad your icome with pesio cotributios, icludig ay your employer makes towards your pesio savigs, is 150,000 or more. Whatever your earigs level, you ca carry over ay aual allowace you have ot used up i the previous three tax years. You ca check olie whether you have goe over the Aual Allowace, or whether you have ay uused Aual Allowace you ca carry over. Go to www.tax.service.gov.uk/paac If you are a high earer, you ca check olie whether the tapered Aual Allowace affects you. Go to www.gov.uk/ guidace/pesio-schemes-work-out-your-taperedaual-allowace. Moey Purchase Aual Allowace If you flexibly access your DC savigs, for example via drawdow, the Moey Purchase Aual Allowace (MPAA) is the amout that ca be paid i oe year to your DC arragemets without a tax charge applyig. This applies to DC savigs oly, icludig AVCs. The limit was iitially set at 10,000 a year but the Govermet iteds to reduce it to 4,000 a year, back-dated to April 2017. It applies if you access DC savigs over age 55. It is your resposibility to moitor your positio agaist the pesio tax allowaces. Recap o retiremet optios I the last member ewsletter, we told you about some chages itroduced i April 2015 i relatio to how you ca access your DC beefits. You ca buy a auity with your DC beefits, to provide you with a guarateed, stable icome for life (but you o loger have to do this). You ca choose to take your DC beefits as cash oly, either i istalmets or as a oe-off sum. You ca take a icome as ad whe you wat to ad cotiue to ivest the rest, kow as icome drawdow (you will eed to trasfer out of the Pla ito aother arragemet to do so). I all cases, you ca take up to 25% of your DC beefits as a tax-free cash sum (uder curret law). You ca also combie ay of the optios to suit your circumstaces, but ote that you may eed to trasfer out of the Scheme to do so. Members of the Defied Beefit sectio ca also access these optios by trasferrig beefits out of the Pla ito a suitable DC arragemet. We strogly recommed that you take idepedet fiacial advice before proceedig with a trasfer out ad if the value of your beefits is 30,000 or more, you are legally required to take idepedet fiacial advice before trasferrig out. The Govermet has also recetly take steps to help savers uderstad the ew retiremet optios. If you are over age 50, have beefits withi a DC scheme ad are iterested i takig advatage of oe of the ew choices at retiremet you ca cotact Pesio Wise, a free ad impartial service provided by the Govermet. We recommed you seek appropriate guidace or advice to uderstad your optios at retiremet. You ca get free guidace over the phoe or face to face with Pesiowise. Go to www.pesiowise.gov.uk or call 0800 138 3944. The Moey Advice Service (MAS) guide is also available o the Pesiowise site. AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN 7
State Pesio ews The sigle State Pesio was itroduced o 6 April 2016. It replaced the previous two-tier arragemet. If you were already receivig your State Pesio at this date there is o chage to this. If you are ot yet receivig your State Pesio, did you kow that you will eed to claim it whe you become eligible? You will ot receive it automatically. You will receive a letter four moths before you reach your State Pesio Age (SPA) explaiig how to claim it. If you are withi four moths of your SPA, you ca claim it olie at www.gov.uk/claim-state-pesio-olie. State Pesio Age State Pesio Age is curretly 65 for me ad will be 65 for wome by November 2018. It icreases to age 66 for everyoe by 2020, ad to age 67 betwee 2026 ad 2028. A rise to age 68 has bee recommeded betwee 2037 ad 2039. If you are ot sure of your SPA, you ca check olie at www.gov.uk/state-pesio-age State Pesio forecast You ca get a estimate of your future State Pesio olie at www.gov.uk/check-state-pesio Protect yourself from pesio fraud Pesio scams cotiue to pose a threat to uwary pesio savers. A commo approach ow is to offer a free review of your pesio ad claim to be backed by the Govermet. The Pesios Regulator, www.thepesiosregulator.gov.uk, has updated its guidace o pesio scams with a series of warig sigs. If you receive a uivited phoe call, email or text offerig help with your pesio or a free pesio review, the advice is to hag up or delete the message. It is highly likely to be a scam. Scammers may pose as fiacial advisers ad eve preset a professioal-lookig website. Legitimate UK fiacial advisers should be registered with the Fiacial Coduct Authority ad be authorised to give advice o pesios. Offers ivolvig guarateed ivestmet returs are highly likely to be scams. Be wary if you are pressured ito makig a quick decisio, i particular if you receive documets via a courier for you to sig. Ayoe claimig you ca take your pesio before age 55 is likely to be a scammer. Curretly, you ca oly access pesio beefits before age 55 if you suffer serious ill health. If you are tempted by ay offer about your pesio, please look ito it thoroughly ad take idepedet fiacial advice from a FCA-registered adviser before you sig aythig. If you thik you may have siged up to a scam, report it to Actio Fraud o 0300 123 2040. Savigs There will be a ew savigs scheme for people o lower icomes, called Help to Save. The savigs limit for ISAs will also icrease to 20,000 from April 2017 ext year. 8 AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN
AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN 9
New rules o protectig persoal data As your Trustee, we hold persoal details about you that are essetial for ruig the Pla. From 25 May 2018 a ew EU regulatio, the Geeral Data Protectio Regulatio ( GDPR ), replaces the Data Protectio Act. The aims of this ew regulatio are: to give people more say i how their persoal iformatio is used; ad to improve security by stadardisig the way orgaisatios throughout the EU store ad use persoal iformatio. While the UK is curretly egotiatig to leave the EU, it will still be a member whe the GDPR comes ito effect, so UK orgaisatios will have to comply. We are curretly lookig at our processes for hadlig persoal iformatio to make sure they will comply. If we eed to make ay chages for example, the way we ask you for permissio to use your persoal details we will let you kow. Otherwise, this chage will remai behid the scees as far as you ad your Pla beefits are cocered. Member Nomiated Director process I accordace with the Pesios Act 2004, at least oe third of the total umber of Directors of the Trustee Board of Avo Rubber Pesio Trust Limited must be omiated by members. The remaiig Directors are Compay Nomiated Directors omiated by Avo Rubber plc. There are curretly six Directors, of whom two are MNDs. The term of office of the curret MNDs, Eric Fieldig ad David Little, will expire o 1 October 2018 ad members are therefore ow ivited to submit omiatios for the role accordig to the arragemets below. Both Eric ad David have advised that they are willig to stad agai for reelectio. The Pesios Regulator expects the Trustee Board to be able to demostrate that the MND omiatio ad electio arragemets adopted are fair, proportioate ad trasparet ad we believe that the arragemets set out below ad i the materials available o our website meet these priciples. All active, deferred ad pesioer members of the Pla are eligible to omiate themselves. Each omiatio will require the sigature of two other eligible members. Please ote that omiatios must be received by 30 April 2018 ad that deferred members are beig icluded for the first time. Prospective MNDs should ote that they will be expected to udergo traiig, icludig completio of the Pesios Regulator s olie traiig (accessed via www.trusteetoolkit. com), ad to atted up to six meetigs each year. You may wish to familiarise yourself with guidace for Trustees o the Pesios Regulator s website if you are cosiderig omiatio (www.thepesiosregulator.gov.uk/trustees/ guidace/idex) A more detailed summary of the omiatio process, a descriptio of the requiremets of the role of Director ad the omiatio form are available o the Pla s website. 10 AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN
Meet the Trustees The Pla s advisors Auditor Ivestmet Maagers Miles Igrey-Couter (Chairma) Bakig Eric Fieldig (Member Nomiated) Scheme Actuary Susa Hoare FIA David Little (Member Nomiated) Defied Cotributio Provider Rob Wills (Compay Nomiated) Fial Salary Admiistrator & Ivestmet Cosultat Legal Advisor Zoe Hollad (Compay Nomiated) Mike Harral (Compay Nomiated) AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN 11
Further iformatio By law, o-oe ivolved i your Scheme ca give you advice about your pesio arragemets. If you are thikig of makig ay chages to your pesio arragemets at ay time, you should obtai as much iformatio as you ca ad thik about obtaiig idepedet fiacial advice. The Fiacial Coduct Authority (FCA) has a website www.fca.org.uk where you ca kid fid out more about fidig ad usig a suitably qualified fiacial adviser. You ca fid a adviser i your area by searchig the Moey Advice Service directory at www.directory.moeyadviceservice. org.uk/e. Before you appoit ayoe, you should check that the adviser is suitably qualified ad authorised. You ca do this olie at www.register.fca.org.uk or by phoig the Fiacial Coduct Authority helplie, 0800 111 6768. DEFINED BENEFIT PLAN ADMINISTRATOR MONEY PURCHASE PLAN ADMINISTRATOR Mercer Cosultig Limited, PO Box 505, Chichester, PO19 9AF Member Helplie: 0800 046 6183 Stadard Life, Dudas House, 20 Brado Street, Ediburgh, EH3 5PP Member Helplie: 0800 634 7479 TRUSTEE REPORT & ACCOUNTS The Trustee Directors publish a formal Report ad Accouts each year that covers some of the items outlied i this ewsletter. Please ask Mercer if you would like a copy or a copy of the Fudig Review by the Scheme Actuary. You should write to Mercer if you would like to see the Pla s Trust Deed ad Rules or if you wat a further copy of the curret Members Booklet. All of these documets are available o the Pla s website. www.avo-rubber.com/pesios INTERNAL DISPUTE RESOLUTION If you do have ay problems with the Pla it is hoped that these ca be resolved by the Admiistrators. If ecessary, however, the Trustee Directors have a formal process for dealig with member disputes. Further details of this are available from Mercer or via our website. You may also be able to obtai assistace from the followig exteral bodies: The Pesios Advisory Service Ltd (TPAS) TPAS is available to assist members ad beeficiaries of the Pla with difficulties that they may have failed to resolve with the Trustee Directors or Admiistrators. www.pesiosadvisoryservice.org.uk The Pesios Ombudsma The Pesios Ombudsma has the power to ivestigate ad decide upo complaits ad disputes ivolvig occupatioal pesio schemes. He will ormally expect to act oly whe a matter has bee through the Pla s Iteral Dispute Resolutio Procedure ad referred to TPAS ad ot satisfactorily cocluded. www.pesios-ombudsma.org.uk The Pesio Tracig Service The Pesio Tracig Service eables ex-members of schemes with pesio etitlemets, ad members depedets, who have lost touch with earlier employers. The Pesio Service 9, Mail Hadlig Site A, Wolverhampto, WV98 1LU Telephoe: 0800 731 0193 www.gov.uk/fid-lost-pesio State Pesio If you would like a forecast of the State Pesio payable to you, please cotact: Future Pesio Cetre, The Pesio Service 9, Mail Hadlig Site A, Wolverhampto, WV98 1LU Telephoe: 0800 731 0175 www.gov.uk/future-pesio-cetre 12 AVON RUBBER RETIREMENT AND DEATH BENEFITS PLAN