University of Aberdeen Superannuation & Life Assurance Scheme (UASLAS) Questions 11 June 2013

1. University of Aberdeen Superannuation & Life Assurance Scheme (UASLAS)Questions11 June 2013

2. Questions Question 1 • How many people have joined the scheme since auto-enrolment began? • 181 automatically enrolled from 1 May 2013 • 74 opted out before contributions were taken • also others who have missed the deadline • 3 requests to join from non eligible members • 2 existing members have requested to withdraw

3. Question 2 • Due to auto enrolment, with a potential  increase in active members, the University’s contributions will also increase, and so increase the University’s pay role bill. • What impact does this have on University’s finance and • does this change the University’s view on scheme viability? • Irene Bews to respond on behalf of the University

4. Question 3 • We are aware of a failed pension payment due to a systems failure at Prudential last year. It would appear that there is no single point of contact for pensioners to direct their queries. • Could we identify who that contact should be, and make it public?

5. Question 3 • Prudential failure to pay direct debit payments one month to some pensioners. • Did not just affect UASLAS. • Prudential rectified the problem as quickly as they could. • Recorded message on their telephone line explaining the problem and what was being done to sort it out. • There is no nominated point of contact but a call centre.

6. Question 4 • The service offered by Prudential since they moved the Stirling telephone number to the call centre is atrocious.  • They deny you exist when you phone and that is after being on for over an hour and passed to different departments.  I have been transferred to the USS AVC department as well as the active member’s administrators.  • Can we look at moving the pensioner payroll to another administrator?

7. Question 4 • Prudential have been looking into call centre problems. • We understand that call handlers are to be given extra training to help them more effectively • identify plan type and • deal with calls from UASLAS members... but • Please keep providing feedback • To enable us to put pressure on Prudential to improve service • Trustees can consider moving pensioner payroll but • May be costly • Could require moving “live” administration also

8. Question 5 • Page 2 in short report, Returns on Investment, column two • should it be 2011/2012 and not 2010/2011? • Yes

9. Question 6 • Page 2 in short report, Income – University Contribution for 2011/2012 is £159,945 less than 2010/2011 despite there being 17 extra active members. • Is this because there are fewer staff above grade 4 than before? • Scheme year 2011/12: • 78 new entrants • 61 exits (10 retired, 33 deferred, 17 refunds, 1 death)

10. Question 6 • More detailed look at contributions paid:

11. Question 7 • Is it possible to tell us how state pensions post 2016 (i.e. when the flat rate starts) will be affected bearing in mind UASLAS is contracted out: • for members who are already receiving their superannuation prior to 2016 but will not receive their state pension until post 2016? • and • for members who will not be in receipt of both until after 2016?

12. Question 7 • State Pension is independent of Scheme benefits • Changes to a member’s State Pension • Not affected by when member retires from UASLAS • Depend only on individual’s State Pension date • Summary of changes:

13. Transitional arrangements • NI records translated into single-tier pension at inception • “foundation amount” • Deduction made for contracted-out service • Similar to current position • A contracted-out member would not receive the full SERPS/S2P pension • If (reduced) “foundation amount” is below full single-tier pension • Further State Penison accrual possible • If greater than full single-tier pension • No extra State pension from subsequent qualifying years • But any excess is “protected” and added to single-tier pension at State Pension Age

14. Question 8 • Can we have some clarification on death benefits if you are single and a parent of children over 18.  • What exactly does “Trustees discretion mean”? • Death benefits: • Lump sum multiple of salary • Lump sum refund of contributions • Dependant’s pension is payable to surviving children • Until youngest child reaches age 23 • Above assumes member is active • Can provide more specific answer separately if not the case

15. Question 8 • “Trustees discretion” is required for UASLAS to be a “qualifying” Scheme for tax purposes • On death of a member Trustees • Consider a member’s wishes (nomination form) • But cannot be bound by a member’s wishes • Usually most relevant to lump sum payments • In practice trustees typically follow members’ wishes • But may consider other factors also • E.g. nomination may have been completed some years earlier • Member’s circumstances altered since then

16. Question 9 • I am a single deferred with no dependants. • Can I nominate a friend as a dependant?  • What happens to the refund of contributions in my case should I die before I retire? • Can I nominate anyone to recover them or only a spouses, partner or child?

17. Question 9 • Can I nominate a friend as a dependant?  • Can I nominate anyone to recover them or only a spouses, partner or child? • Lump sum is payable to one or more “Beneficiaries” • This includes “any person nominated by the Member as a Beneficiary” • But Trustees not bound by this nomination • So • Yes can nominate a friend or someone else as a “Beneficiary” • Not necessarily spouses, partner or child

18. Question 9 • What happens to the refund of contributions in my case should I die before I retire? • Payment made at Trustees’ discretion • Trustees will consider nomination form • Possibly other relevant information also • E.g. member’s circumstances • If no nomination form / dependants • Payment most likely to member’s “legal personal representatives” (i.e. estate)

19. Question 10 • Does Prudential have to provide the AVCs as they no longer provide any support to us. • To be discussed as part of the Trustees meeting