New Zealand Harbours Superannuation Plan

1. New Zealand Harbours Superannuation Plan An update for members of the Superannuation Scheme July 2011

2. Origins of the Scheme • Cash accumulation scheme established in 1985 by the employers and unions in the New Zealand Harbour Industry • Aim was to provide a better and more flexible means of saving for retirement than membership of the National Provident Fund • Original union was Harbour Workers which amalgamated to form Rail & Maritime Transport Union in 1995

3. Benefit entitlements • Retirement, withdrawal, death or disability, ill-health and resignation benefits provided for members and their dependants • Retirement – total of member and employer accounts; assistance with annuity purchase decision if required • Death or Total and Permanent Disablement – total of member and employer accounts plus an age-dependent multiple of salary • Ill Health or Retrenchment – total of member and employer accounts • Resignation – total of member and employer accounts

4. Contribution details • Member generally contributes minimum percentage of earnings (defined as basic salary plus overtime and bonus) directly from pay • Member can be at nil contribution if employer agrees to additional contributions • Member can make additional voluntary lump sum or regular contributions • Employer generally contributes $1 for each $1 contributed by the member to a maximum percentage of earnings • Employer Superannuation Contribution Tax is deducted from employer contributions at the appropriate rate • Net contributions are credited to the member account and to the employer account in the name of the member

5. Investment overview • The Scheme is invested in a balanced mix of assets comprising NZ and Offshore equities and bonds, properties, and cash. • Trustees: • Set proportion of funds in each asset class • Set investment objectives/policy and monitor performance. • Select and review investment managers. • Investment objectives • Minimum real rate of return after tax of 2.5% p.a. • An average return compared to the balanced funds in the MJW investment survey. • The assets of the KiwiSaver Scheme will be invested with the assets of the Superannuation Scheme.

6. Fund managers • AMP Capital Investors New Zealand: • New Zealand’s largest fund manager. Owned by large Australian parent company. • Strong Investment teams in Australia and New Zealand. • Actively manage 29.5% of Plan assets in their NZ shares, NZ listed property, global listed property, NZ bonds and cash funds. • TOWER Asset Management Limited: • New Zealand’s third largest fund manager. • Recent reconfiguration of investment teams and products. • Actively manage 63.0% of Plan assets in their Australian shares, Global shares, NZ direct property and Global bonds funds. • Tyndall Investment Management Limited: • New Zealand’s fourth largest fund manager. Recently acquired by Nikko Investment Asset Management – large Japan-based firm. • Actively manage 7.5% of Plan assets in their Option Fund and multi-manager multi-strategy hedge fund.

7. Recent Scheme investment results The table below shows the gross returns credited to members, after investment fees, but before tax, with a comparison to inflation.

8. Governance of the Scheme (1) • The Scheme has its own Trust Deed • A maximum of nine Trustees, up to four appointed by the Rail and Maritime Transport Union, up to four appointed by a unanimous decision of the remaining Trustees and a Chairman who is appointed unanimously by the Trustees • Current Trustees are: • Chairman: David Stevens (ex-NBNZ) • From Union: Wayne Butson, Hal Upton, Dion Young • Appointed by Union: Roy Cowley (ex-Deloittes) • Appointed by Trustees: David Sharman (CFO, Port Taranaki), Sara Lunam (Corporate Services Manager, Port of Tauranga)

9. Governance of the Scheme (2) • Independent Scheme managed by its own Trustees • Trustees make decisions based on the needs of the industry and their members • The Scheme has own relationship with its advisers • Operated on a “not for profit” basis with costs kept to minimum • No shareholder return on capital requirements • Long and established history

10. Advisers involved with the Scheme • Auditor Deloitte • Solicitor Johnson Lawrence • Administration Manager Melville Jessup Weaver • Plan Secretary Leonie Stieller • Insurer Sovereign • Investment adviser Melville Jessup Weaver

11. Member Benefits from Scheme

12. Regular information to members • Annual Report as at 31 March year end • Financial Statements as at 31 March year end • Member Benefit Statement as at 31 March year end • Chairman’s newsletter each quarter • Website with Scheme and Member information – www.harbourssuper.org.nz • Administrator or Scheme Secretary can be contacted at any time, for information such as: • Estimate of current benefits • Copy of current Investment Statement • Copy of current Prospectus, Trust Deed

13. Other information • Harbours Plan (for information about the present Plan) – www.harbourssuper.org.nz • Sorted (for information about your finances and KiwiSaver) – www.sorted.org.nz • Inland Revenue (for information about KiwiSaver) – www.kiwisaver.govt.nz

14. Dialogue with members • Always keen to receive feedback and ideas about the Scheme. • Presentations or meetings can be arranged, including question and answer sessions.