Aviva Group Personal Pension Scheme Management Committee Report

Transcription

1 4 November 2014 Performance and Resources Board 15 To consider Aviva Group Personal Pension Scheme Management Committee Report Issue 1 A summary of the work undertaken by the Aviva Group Personal Pension Scheme Management Committee since its first meeting on 30 September Recommendations 2 The Committee is asked to: a Note the Aviva Group Personal Pension Scheme Management Committee Report b Agree the amendments to the Aviva Group Personal Pension Scheme Management Committee s Statement of Purpose, including a change of name for the Committee to the Aviva Group Personal Pension Plan Management Committee (at Annex A).

2 Aviva Group Personal Pension Scheme Management Committee Report Issue 3 The Aviva Group Personal Pension Scheme Management Committee is an advisory forum which monitors and reviews the operation of the defined contribution (DC) pension plan. The Committee was established by Council on 22 May 2013 and the DC pension plan became operational on 1 July The Committee reports to the Board on its work and any matters requiring a decision. This is the Committee s first report to the Board and covers the work undertaken at the Committee s first three meetings on 30 September 2013, 6 May 2014 and 13 October Key matters considered by the Aviva Group Personal Pension Scheme Management Committee since its first meeting on 30 September 2013 Appointment of Plan Members 5 No Plan members had been appointed to the Committee prior to its first meeting on 30 September 2013, but the appointments process was agreed at that meeting. All members of the Aviva Group Personal Pension Plan, as of 17 March 2014, were contacted and advised that they could put themselves forward as Committee members. Four expressions of interest were subsequently received. 6 At its meeting on 10 April 2014, the Board agreed to amend the Committee s Statement of Purpose, to increase the number of Plan member places on the Committee from three to four. The Committee also noted this amendment at its meeting on 6 May As a result, all four Plan members who had applied to sit on the Committee were appointed. They are: a Rebecca Fellows, Registration and Revalidation, Manchester. b Janet Gray, Fitness to Practise, Manchester. c Bradley Meij, Education and Standards, London. d Iain Kingston, Resources and Quality Assurance, Manchester. 7 All members of the Aviva Group Personal Pension Plan were notified of the Plan member appointments on 28 April All the new Committee members have attended induction sessions. 2

3 Role and operation of the Committee 8 The Committee considered its role and Statement of Purpose at its meeting on 30 September The Committee noted that its role would need to be kept under review as the Plan developed, to ensure that it remained appropriate. It also agreed that representatives of the Aviva Group would be invited to attend one Committee meeting per year. 9 The Committee decided to cancel its meeting on 9 December 2013, as it was too early in the life of the Plan to undertake a meaningful review of its main activities. 10 The Committee considered the Pension Regulator s guidance for pension scheme management committees, Monitoring your pension scheme, at its meeting on 6 May It then reviewed its Statement of Purpose, in the light of this guidance, at its meeting on 13 October The Committee agreed the following amendments to its Statement of Purpose at this meeting: a To include receiving and considering advice and information concerning legislative changes and good modern practice. b To make specific reference to monitoring the performance of the default fund. c To change its name to the Aviva Group Personal Pension Plan Management Committee, to align this with the name of the Pension Plan. 11 These amendments are shown with tracked changes at Annex A. 12 At its meeting on 13 October 2013, the Committee reviewed its work programme for It agreed to hold an additional meeting in July 2015, to consider the impact of upcoming legislative changes. Progress in implementing the Aviva Group Personal Pension Plan 13 The Committee received updates on progress in implementing the Plan at all three meetings. 14 At its meeting on 30 September 2014, the Committee noted that Sharia compliant investment options would be made available as soon as staff joined the Plan. It also noted the decision, taken by the Performance and Resources Board at its meeting on 9 September 2013, to establish a death in service benefit Trust for the Plan. 15 The Committee considered how the Plan would be promoted to staff and noted the need to consider communications carefully, to avoid any confusion with our final salary pension scheme. 16 At its meeting on 30 September 2013, the Committee noted that communications would take place with staff regarding auto-enrolment. 3

4 17 At its meeting on 6 May 2014, the Committee noted that: a Many members of the Plan were contributing at a variety of higher rates above the 2% minimum threshold. b The age profile of the Plan was currently very young. c Work was ongoing with A-on Hewitt to develop the support which would be offered to Plan members who were approaching retirement. 18 At its meeting on 13 October 2014, the Committee considered an update on the operation of the death in service scheme, which included a review of beneficiary nomination forms. The Committee particularly noted the importance of encouraging Plan members to return a nomination form for their beneficiaries and agreed that reminders should be included in the member newsletter. 19 The Committee also noted at this meeting that there had only been 13 people who had opted out of the Plan and that seven of those had done so at the staging date. It was noted that people who opted out were often close to leaving the GMC. Aviva Group Personal Pension Plan Performance Monitoring 20 At its meeting on 6 May 2014, the Committee considered a report from Aviva on the Plan s performance. The Committee agreed that Christine Firth, Pensions Manager, would work with Aviva to develop the format of future reports, to ensure they met the Committee s future requirements. Following this work, an enhanced version of the report was reported to the Committee at its meeting on 13 October At its meeting on 6 May 2014, the Committee also agreed that it would consider a report on the Plan s performance every six months. New standards and charges for pension schemes 22 At its meeting on 6 May 2014, the Committee gave careful consideration to an update from its advisers, Aon Hewitt, on the Government s Command Paper: Better workplace pensions: Further measures for savers. This proposed new minimum quality standards for all DC workplace pension schemes, proposed a 0.75% charge cap on default funds for defined contributions, and proposed governance standards for the scheme provider (in our case Aviva) for each DC workplace scheme. 23 The Committee also considered the implications of proposals announced in the Government s Budget, on 22 April 2014, in respect of the different ways in which retirees could receive their pension and in terms of the support they would receive on retirement. The Committee noted that it would be receiving further updates on the potential impacts of these announcements at future meetings. 4

5 24 At its meeting on 13 October 2014, the Committee considered a report from Aon Hewitt regarding the implications of these proposals for its Statement of Purpose, the Plan members and the GMC as an employer. 25 The Committee noted that most of the responsibility for meeting these new requirements lay with Aviva, but the Committee would need to assure itself that Aviva was discharging its responsibilities effectively. The Committee also noted that the Plan s current charges were 0.38%, which was well below the proposed charge cap, and that the Plan was in a good place to respond to the changes. Conflicts of Interest Protocol 26 At its meeting on 6 May 2014, the Committee agreed that a Conflicts of Interest Protocol for Committee members would be developed, and this was adopted by the Committee at its meeting on 13 October Amendment to the Declaration of Trust for the Life Assurance Scheme 27 On 11 August 2014, the Committee was notified by of a decision taken by the Performance and Resources Board, on circulation, to amend the Declaration of Trust for the Life Assurance Scheme. The Scheme name was amended from the GMC Group Personal Pension Plan to the General Medical Council Group Life Assurance Scheme through a Deed to effect the change. It had come to light that the name of the Scheme in the Declaration of Trust had been different to the name under which the Scheme was registered with Her Majesty s Revenue and Customs, due to an administrative oversight. This had needed to be corrected to ensure that benefits could be paid to Scheme members. 5

6 Supporting information How this issue relates to the corporate strategy and business plan 28 The Committee s responsibilities in monitoring and reviewing the operation of the DC pension scheme align with our commitment within the Corporate Strategy to make the best use of our resources. If you have any questions about this paper please contact Andrew Bratt, Assistant Director Human Resources, abratt@gmc-uk.org,

7 15 - Aviva Group Personal Pension Scheme Management Committee Report Annex A Aviva Group Personal Pension Scheme Plan Management Committee: Statement of Purpose Background 1 This annex sets out the draft Statement of Purpose for the Aviva Group Personal Pension Scheme Plan Management Committee. This is an advisory group that reports matters that require decision to the Performance and Resources Board. Membership 2 The Committee is chaired by the Director of Resources and Quality Assurance. Other members include: a The Assistant Director Human Resources. b The Assistant Director Finance. c The Head of Complex Casework and International LiaisonIntelligence. d Four Scheme Plan member nominated committee members. 3 It is proposed that Scheme Plan member nominated Committee members are elected on three year terms. 4 The Committee will be advised by appropriate professional advisers as required. Working arrangements 5 The Committee will meet twice a year and provide an annual update to the Performance and Resources Board on its work, which in turn will report annually to Council on the SchemePlan. 6 Secretariat duties are undertaken by the Governance Team. The Committee Secretary minutes each meeting and aims to circulate the minutes, as cleared by the Chair, to members for comments within two weeks of the meeting. The Committee approves minutes at the next Committee meeting. Minutes record the conclusions of the Committee on the issues considered and will be cascaded to staff as appropriate.

8 Reports and papers considered at meetings of the Committee will not normally be published. Duties and activities 7 The Committee will be responsible for monitoring and reviewing the operation of the Defined Contribution Pension Scheme Plan including: Member concerns 8 Monitoring the mechanisms for improving member understanding and engagement, especially in relation to decisions on investment choices and retirement options. 9 Advising on communications to prospective members and active members. 10 Providing a point of contact for members to raise issues regarding the Scheme Plan that they have not been able to resolve with the provider. 11 Ensuring that diversity issues relating to members are considered and responded to (including accessibility). Legislation and good practice 12 Receiving and considering advice and information concerning legislative changes and good modern practice. Employer issues 1213 Monitoring and reviewing key data relating to the Scheme Plan including membership numbers, leavers and opt outs Reviewing the provider s service levels and administration Advising the employer on any relevant diversity issues including how the Scheme Plan meets diverse needs and avoids unfair discrimination. Investment performance options 1516 Monitoring the investment performance of the options the provider makes available for Scheme members Monitor and review the fees charged to Scheme Plan members Ensure that the provider has available a suitable range of investment options in line with member requirements, with specific reference to the default fund Commission, as required, any GMC specific investment options or products. A2