The Yell DB Pension Scheme & Proposals for Replacement
06 Dec 2010
You will have received today the company's consultation document outlining its proposals for future pension provision.
This has been issued following the first meeting of the formal consultative group, comprising representatives of Yell, Prospect, the CWU and employee reps elected from amongst those in the company not covered by unions.
This first formal meeting took place following initial discussions between Yell and Prospect and the CWU, which focused on Yell's proposed closure of the Defined Benefit scheme for future accrual, and on the critical issue of the employer contribution rate to a replacement Defined Contribution scheme. The unions' aims in these initial talks was to seek to ensure that (1) proper consideration was given to keeping the DB scheme open albeit with changes and, if that could not be achieved - and it became clear that it couldn't be - (2) that a replacement DC scheme was capable of generating decent pensions for the DB population.
Both Prospect and the CWU believe that the employer contribution rates proposed for the DC scheme will achieve that critical aim.
But that certainly does not mean that there is nothing more to discuss. There are a range of issues that the unions have put forward for the consultative body to deal with. They are;
* the governance arrangements for the new scheme - that is, the way it is to be managed and the way funds are invested.
* the fee charging arrangements in the DC scheme - this is a significant issue for DC scheme members, as the investment fees can make a hole in scheme members' funds
* the arrangements for deferred pensions that all DB members will have when the DB scheme is closed to future accrual
* the death in service provisions under the DC scheme, and the way these relate to the 'death in deferment' provisions in the DB scheme.
* the provision for medical retirement and the arrangements in the DC scheme for those who suffer permanent ill health, and the way these would relate to the provisions for early payment of pension on ill health grounds for deferred members of the DB scheme.
* ensuring that the redundancy terms currently provided for via the DB scheme are maintained
* seeking to provide access to sound advice and guidance for DC scheme members - this is necessary in the context of a DC scheme, as individuals will need to take an active role in managing their pension fund.
The next meeting of the consultative body will be on Wednesday 15 December. We will organise a meeting for all members of Prospect and the CWU after that meeting to report on progress and to deal with any questions or concerns you may have. In the mean time we are working with the company to produce an agreed set of FAQs covering the most common concerns. We hope to be able to publish these as quickly as possible. If you have any queries in advance of this please send them to email@example.com or contact a member of the branch committee directly.