From the Chair
Welcome to the Spring/Summer edition of Outlook, accounts which can be found
the Teesside Pension Fund newsletter for contributing on the back page.
LGPS members.
Mouchel Pensions Unit –
Our last issue explained some of the proposed changes which performs the day–to–day
to the LGPS which involved changes to contribution administration for the Teesside
rates and, potentially, accrual rates. Things have Pension Fund on behalf of
moved on since then and all changes to the Scheme Middlesbrough Council – has
have been shelved until April 2014.
moved offices; don’t worry about being able to find
them though, they’ve only moved around the corner!
The government agreed that due to the unique nature
The new address is included in the Contact Us column.
of the LGPS amongst the large public sector schemes,
in exchange for a review of all aspects of the Scheme This edition also includes important news about
from 2014, no changes needed to be made ahead of changes the Prudential (the Fund’s Additional Voluntary
this date.
Contributions provider) are introducing shortly.
Discussions are still taking place at a national level on As always, we hope you find this newsletter useful and
how the LGPS will look following this date. We will informative but feel free to give us your feedback to
keep you informed of proposals as they develop through help improve future editions.
Outlook and via the Teesside Pension Fund website.
Kind regards
Teesside Pension Fund continues to perform strongly
despite the financial uncertainties that we all hear and
Steve Bloundele
read about daily! As usual, this edition includes a brief
summary of the Teesside Pension Fund statement of
Warning against early pension release offers
(Pension Liberation)
The Financial Services Authority (FSA) has teamed
up with The Pensions Regulator and HM Revenue
& Customs to warn consumers against early release
pension schemes.
An increasing number of people are being approached
by firms offering to release, unlock or transfer cash
tax–free from their pension before they retire, for
immediate use. Contact is usually made through cold–
calling, via websites or through small advertisements
in newspapers.
You need to be very cautious about these schemes as
there is a significant chance that these are scams trying
to con you out of your money!
Keeping
the
pension
fund
community
in touch
How does pension liberation work?
Firms may suggest you opt out of your current pension
arrangement then offer:
• to transfer your pension pot overseas so you don’t
pay UK tax, or
• to an alternative provider that will invest your money
overseas so you don’t pay tax on the investment, or
• to receive a cash sum ahead of your retirement
What are the risks?
It may be tempting to think that the pension you
have built up could be used to solve some short
term problems but the potential risks are severe, and
include:
• the loss of the entire pension saving if the
arrangement is a scam;
• no income in retirement other than State benefits;
• the payment of high fees (which are deducted from
the pension fund as it is transferred) to firms making
the arrangement on behalf of the member; and
• significant tax charges for the individual where the
funds are taken out of an occupational or personal
pension arrangement early since this will constitute
an unauthorised payment.
What should I do if I am approached to release my
pension early?
Firstly, remember the old saying, “if something
sounds too good to be true, it probably is”! Also:
• Don’t be panicked or bullied into making
any decision. If you do need a loan to cover
any debts you have please talk to a registered
financial adviser for other options available
to you before signing your pension benefits away.
• Remember that any firm that sells, advises
on or arranges transfer of personal pension
plans should be authorised by the FSA. Check
the FSA’s register which lists all authorised financial
services firms: http://www.fsa.gov.uk/fsaregister
• If you are concerned about a firm that is offering
these ‘liberation’ services, please contact either the
FSA via their Consumer Helpline on 0845 606
1234, HMRC’s Pensions Anti Fraud Unit on 0115
974 2147 or The Pensions Regulator on 0845 600
0707. Provide as much information as you can
about the services and the firms involved, including
their contact details and ‘firm reference number’
(FRN) if they claim to be authorised by the FSA.
Spring/Summer 2012
Become Unobtainable
How to ditch the junk mail, calls and emails…
Ever thought about how much time you
spend dealing with junk phone calls, mail,
faxes or emails? Even if it’s just five minutes
a day, by the end of the year that adds up
to over a whole day that someone else
has wasted of your life. Happy about that?
Probably not! Here’s what to do:
If you get marketing phone calls or direct
mail addressed to you, you will want to
get on to either the Telephone or the Mail
‘Preference Service’ which effectively
puts you on a ‘do not contact’ list.
Marketers are meant to check
and delete anyone who has
registered. So once on, you
shouldn’t be contacted
any more.
paid the postage on your letter, and that you
will keep writing to them like this until they
stop. Then post your letter in the company’s
own response paid envelope, or put it in an
addressed envelope and leave off the stamp.
For spam email, the law says you should
only receive emails from companies that you
agreed to receive mail from, and that you
have relationship with. Legitimate marketers
will always include an unsubscribe option
on their email. Just click, and unsubscribe.
However others are a bit more ‘spammy’ in
their approach. They don’t want you off their
list as they assume that sooner or later – if
they send enough emails – you might buy
something. So:
•
•
•
The problem with it is that it takes time and
money for marketers to update their records,
and many may not bother. So here’s the next
best bet:
If you receive rogue calls, explain you are
on the list and they should take you off their
list immediately. If the calls continue, ask for
the person’s name and the company’s name.
Then explain the position again and ask
to be taken off the list immediately, or you
will get in touch with their CEO, their trade
body or even Watchdog about this apparent
harassment.
If you receive rogue direct mail, reply
to them with a letter explaining that they
have you on their database but they need
to take you off, under the rules of the Mail
Preference System. Also mention that they
Some won’t include an unsubscribe
option.
Some do, and wait to see who clicks as
that indicates they sent mail to a real
email address, after which they send
you every spam email they have.
Or some include a link that doesn’t
work or takes you to a site that aims to
compromise your online security.
Either way they are bad news.
So if you don’t recognise the name of the
sender, don’t click anything. You will just
have to set your email programme’s spam
filter to recognise that sender as junk.
The best advice is to sidestep the spam issue
altogether by corralling it into a safe area.
So have your proper email address that you
give out to your friends, family and trusted
companies. In addition set up a discardable
‘other’ email address, perhaps with gmail
(see www.gmail.com for details) and use
that whenever you have to give your email
address to a company.
Then every so often, when the spam gets
unbearable, open a new ‘other’ email
account and then stop picking up the email
from your former ‘other’ address. All your
junk will stop immediately!
Discount shopping – but be careful
Love a bargain? You’ll love ‘voucher’ sites. But don’t go crazy!
If you are a canny shopper, there’s a new type of site
around that could get you massive discounts – up to 80%
in some cases – on specific products or services. That could
be a deal on a particular TV, jewellery, holiday, sports
equipment, spa treatment or meal out.
That makes this a fantastic money – saver – but only if you
have the right strategy.
The biggest such sites currently in the UK are www.
Groupon.co.uk, www.Wowcher.co.uk and www.
LyncMeUp.co.uk. To sign up, just go to the site and register.
It’s quick and free to do so. Just enter your name,
address and click on the link if you have a Facebook
account (you can connect to the site via your
Facebook account if you prefer to, although that’s
optional). Once that’s done, you’re in.
Some sites let you view deals geographically.
When you register they ask what town you are
near, so you only see the deals that are relevant
to you. If you get a deal for a restaurant for
example, it’s usually a local one in your
home town, not one miles away.
Then sit back and wait for the daily
email each site sends with that day’s
special offers. Or if you have a smart
phone, you can use the site’s app to
see the latest deals while on the go.
Discount site tips
If it’s a really big discount, then
often the deal has limited stock or is
only up for a short time, eg 24 or 48
hours. So if you want it, don’t wait!
Otherwise a timer bar shows you how
much longer the deal is available for.
Many popular deals do come back
time and again. Hair and beauty
treatments are popular and a great
way to try out new salons near
you. And you often see anti–
virus software, or photo
items such as printed
coffee table books
featuring your photos
(great present for a birthday or wedding anniversary) or
large canvas prints of your favourite photo. So if you miss
those regular deals, don’t worry – another one will be along
soon!
There may be other charges to pay such as delivery on a
heavy item – so read the small print carefully.
And the number one rule…
Even if it’s a bargain, it’s still money. Buying a lot of
bargains can make you broke, if you’re not careful. So
have a proper think about your strategy – maybe
one of the following:
Visit on a budget
Have a monthly amount you’ve worked out is
OK to spend on sites like this.
Visit on a mission,
Only buy stuff you would have bought
anyway like memory cards for your
camera, or extraordinary experiences
that would make great presents –
such as a day of falconry or a 10
minute helicopter ride over your
town.
Visit on a schedule
If you want to get a massage every
3 months or have a hair treatment
twice a year mark that in your diary
so you know when to start looking for
bargains.
Visit with focus
Just get the deal, nothing more.
Retailers offer these discounts to let
you try their services. But they would
go out of business if they did that
every day. So they want to encourage
you to become a regular customer,
or to offer you an ‘upsell’ so you buy
something else (e.g. a new set of
pillows to go with that mattress, or a
case for your new camera). It might be
a welcome add on, but it will increase
your final bill – so make sure you
really want it!
Back to basics
Keep on the straight and narrow with our guide to good back health!
Ever had back pain? It’s a common problem
in the UK with 4 out of 5 adults complaining
of this particular problem at some point or
another.
However, with care, your back can carry you
through. It is easier to prevent back injuries
than it is to cure the pain once your back has
been stressed too much. So it’s worth making
extra efforts to keep your back in shape and
not have to suffer down the line. Here’s some
tips on various things you can do to improve
the strength of your back and avoid pain.
Check your posture
Posture is the number one back protector
around, and the way you sit and stand has
a big effect. For optimal back health, you
should always position yourself upright,
straight and symmetrical. Your head should
balance over your shoulders, not be jutting
forward (which strains your upper back).
Your ‘muscle memory’ will revert your
posture to its usual pose unless you retrain
it. So perhaps set an alarm on your phone
or computer every 20 seconds to ping you
a ‘check your posture’ reminder. Your new
stance may feel unusual at first. In fact you
might even think it feels all wrong. However
it’s just because you’re not used to this
position. In time it will become your new
habit!
Sitting
You probably spend a lot of time sitting in
your day – in your house, doing a hobby,
when you’re driving. So check your chairs
give you the right support, particularly
supporting your lower back. There are
ergonomic chairs on the market that are
designed to do just this. Or, try lumbar
cushions or seat covers that specifically do
the same thing.
Sleeping
Your mattress needs to support your back
too. When you’re lying on your back,
you should be able to slip your hand
comfortably between your lower back
and the mattress. Or go for new mattress
technology, developed by NASA
and available in your local
bed store – a memory foam
mattress. This automatically
conforms to your shape and
weight and is a very
comfortable option.
Picking things up
Until now in your back
‘plan’ you’ve been
upright, symmetrical
and straight. However
if you lift something up,
you change all that.
You might be bending
forward, straining,
or balancing another
weight. Now’s the time
when you could damage
a ligament, a muscle or
a disc.
So make sure
your legs do
all the heavy
lifting. Keep
your back
straight, and
bend your knees
as you reach down to lift. Also make sure
your load is secure. If it overbalances, your
reflex will be to save it which might make
you bend or lunge suddenly. Also, check
that the object is a reasonable weight for you
alone; better to ask for help than limp away
with a torn ligament.
Exercise
Your core muscles surrounding your back
help keep everything in the right position. So
keep them in trim by bending and stretching
forwards and backwards, side to side. Ask
at your local gym about specific exercises
to help with avoiding or minimising a back
problem. Don’t forget that for good posture
you need good abdominal muscles as well
as good back muscles. They keep each other
in check!
Thinking of Boosting your retirement benefits
through Additional Voluntary Contributions (AVCs)?
Contact Us
For general enquiries telephone:
01642 727030
If the answer is yes, then you might want to
consider starting your AVC payments sooner
rather than later!
e–mail us at:
[email protected]
Web:
www.teespen.org.uk
Our AVC provider, Prudential, is introducing an exit charge;
this could affect you if your first AVC contribution is received
on or after 19 August 2012 and you withdraw your AVC
fund within 5 years of this first contribution. To be certain
Prudential receive your first contribution before 19 August
you should make sure Prudential receive your completed
application by 8 June 2012 at the latest.
Write to:
Mike Hopwood
Head of Pensions
Mouchel Pensions Unit
PO Box 340
Middlesbrough
TS1 2XP
The table below shows the level of exit charges that may
apply on any funds that you withdraw within 5 years of your
contribution.
% Charge
Withdrawal
during year
1
Withdrawal
during year
2
Withdrawal
during year
3
Withdrawal
during year
4
Withdrawal
during year
5
Withdrawal
from year 6
onwards
15%
10%
8%
6%
5%
No charge
Alternatively you could visit us at:
Mouchel Pensions Unit
Vancouver House
Gurney Street
Middlesbrough
TS1 1HA
PLEASE DO NOT SEND
CORRESPONDENCE TO THIS ADDRESS
The Teesside Pension Fund
is administered on behalf of
Middlesbrough Council
by Mouchel.
The exit charge will be applied after any Market Value Reduction has been applied on withdrawal
from the With–Profits Fund. Charges may vary in the future and be lower or higher than they are
now.
The main situations where an exit charge will An exit charge will not apply if any monies are
apply are–
withdrawn due to–
• Transfers to an alternative pension • Death
arrangement, including an alternative AVC
• Switches between investment funds
• Retirements (with the exception of where
benefits are being taken on the grounds of ill • Retirement on the grounds of ill health
health)
• Pension sharing on divorce
• Where you take a short service refund from
your scheme and AVC fund (and the value of
your AVC fund, after charges, is greater than the
value of the contributions paid)
Existing AVC contributors will not be affected by this change even if you switch
investment funds or change the amount you pay
If you are interested in considering AVCs please call the Pension Connection team on freephone
0800 731 0466. Lines are open 9am to 6pm, Monday to Friday and calls may be monitored or
recorded for quality and security purposes. Alternatively, you can apply online at www.pru.co.uk/
localgovavc under ‘complete application’ and then ‘online application form’.
outlook is published for Teesside
Pension Fund by Evolve. Neither
the publishers nor the Teesside
Pension
Fund
can
accept
responsibility for the views of
this newsletter’s contributors and,
although every effort is made
to ensure the accuracy of the
contents, readers are advised
to take appropriate professional
advice before acting on the
information or advice in these
pages.
Evolve
Unit 8
Woodcock Hill Estate
Harefield Road
Rickmansworth
WD3 1PQ
email: richard.g@evolve–print.com
website: www.evolve–print.com
Teesside Pension Fund
Summary Accounts
The financial performance of the Teesside Pension Fund in the year to 31 March 2011 was again positive, with the
total value increasing by 9% to £2,586 million. As with last year the increase was mainly due to the rise in value of
the investments the Fund owns.
Summary Accounts
Fund value at the start of the year
Income
Expenditure
Change in the Value of Investments
Fund value at the end of the year
2009/10
2010/11
£000
£000
1,700,866 2,371,622
183,435
183,264
(107,385) (114,705)
594,706
146,314
2,371,622 2,586,495
Increase in Fund Value in the year %
9%
The summary accounts show that, as in 2009/10, there was a surplus of income over expenditure which added to the
Fund value. The Fund’s income comes from the contributions of employers and employees and investment income.
The expenditure is made up of monthly pensions, retirement lump sums and members transferring to other Funds.
Geographical analysis of Investments
Fund Assets and Investments at 31 March
2010
2011
£'000s
£'000s
2,350,040 2,565,629
Investments
22,286
Cash and other Assets
Debts owed to the Fund
Amounts owed by the Fund
3,124
(2,357)
(3,492)
Membership Numbers
Million £
Fund Value at 31st March
2,015
10%
2007
2,372
2,048
1,701
39%
Active
2007
25,770
2008
25,577
2009
25,718
2010
24,831
2011
24,341
Deferred
12,810
14,911
16,044
17,320
18,609
2,586
9%
Pensioner
15,462
16,101
16,736
17,438
18,438
-17%
Total
54,042
56,589
58,498
59,589
61,388
2009
The number of active members of the scheme has fallen
for the second year in a row reflecting the difficult
current economic situation. The membership as a whole
has increased by 3% to 61,388.
2%
2008
21,234
1,653
2,371,622 2,586,495
Net assets of the Fund at 31 March
3000
2500
2000
1500
1000
500
0
United Kingdom
United States
Japan
Australia
China
Pacific Region
Germany
France
Hong Kong
Singapore
Others
2010
2011
The value of the fund has increased by 52% from the
low point after the ‘credit crunch’ in 2009.
Actuarial Valuation
By law the Fund has to have a valuation carried out by an actuary every 3 years.
The purpose of the valuation is to review the financial position of the Fund, to
set the employer contribution rates ensuring that the Fund has sufficient funds to
meet its future liabilities. The latest Valuation as at 31 March 2010 was completed
during the year and showed that Teesside Pension Fund is almost ‘fully funded’
with a funding level of 99%.
£million
Net Liabilities
2,250
Assets
2,233
Surplus (Deficit)
Funding Level
(17)
99%