Investment Options
With Flexiplan and Bonusplan, you decide where your contributions are invested.
The Trustee recently reviewed and replaced the investment options available to members of the Royal Mail Pension Plan under the Flexiplan and Bonusplan AVC arrangements. The objectives for the replacement AVC arrangements - which took into account feedback from members - were to provide a simple and competitive range of investment options with efficient administration and clear communications.
After careful consideration, the Trustee selected Zurich Assurance to provide the platform or gateway for the new arrangements. There is a choice of four 'core' funds, with varying risk profiles. All of these funds are managed by Legal and General. In addition, two 'satellite' funds are available. These satellite funds are an ethically focussed fund managed by Legal and General and a fund which complies with Shariah Law managed by HSBC Sinopia.
A communication pack, giving full details of the new AVC options, was sent to members with Flexiplan or Bonusplan funds, on 13 July 2010.
From October 2010, contributions to the previous AVC providers ceased and subsequent contributions are paid to the new arrangements. Existing funds except 'with-profits' funds were transferred to the new funds at the end of 2010.
The Trustee publicised the new AVC arrangements to all active members of the RMPP in January 2011.
Copies of the documents (including the AVC Guide which has details of the fund range) - and the latest fund factsheets - are available in the AVC documents page of the website.
Zurich provides members of the new AVC arrangements with a user number and a password in order that they can view their AVC account on line. If you have lost these details or require your user number or password to be reset, please call the Zurich Royal Mail Service Team on 0800 030 4781 (rather than Royal Mail's Pensions Helpline).
Details of the previous with-profits arrangements, from which funds were not transferred but to which no contributions can be paid, are as follows:
Select any of the above to jump down to more details.
Please note: Past investment performance is no guarantee of future performance. If you are unsure about the investment options you should take independent advice.
Funds are invested in company shares, gilts, bonds, property and cash. There is an annual management charge of 1% of the fund value. Returns are passed onto you through "smoothed" annual bonuses. In addition, on retirement or surrender a further, final bonus may be added. On surrender, however, a reduction may be made to your fund value to ensure that you do not receive more than your fair share of the with-profits assets.
The annual bonuses recently paid or declared, before deduction of the annual management charge, were:
| Year to 31 December | % Rate of Return before charges |
|---|---|
| 2004 | 3.0 |
| 2005 | 3.5 |
| 2006 | 3.5 |
| 2007 | 3.5 |
| 2008 | 2.75 |
| 2009 | 2.75 |
| 2010 | 2.75 |
| 2011 | 2.75 |
Standard Life With-Profits Fund
Funds are invested in company shares, gilts, bonds, property and cash. Returns are passed onto you through "smoothed" annual bonuses. In addition, on retirement or surrender a further, final bonus may be added. On surrender, however, a reduction may be made to your fund value to ensure that you do not receive more than your fair share of the with-profits assets. There is an annual management charge of 0.6% of the fund value.
Annual bonuses recently paid or declared, before deduction of the 0.6% charge, were:
| Year to 31 January | % Rate of Return before charges |
|---|---|
| 2005 | 3.3 |
| 2006 | 2.5 |
| 2007 | 2.0 |
| 2008 | 2.0 |
| 2009 | 2.0 |
| 2010 | 2.0 |
| 2011 | 2.0 |
| 2012 | 1.5 |
Equitable Life With-Profits Fund
There is an annual management charge of 0.5% of the fund value. A guaranteed return is paid under the policy of 3.5% per annum. A non-guaranteed bonus may also be added, if applicable.
A detailed statement about how Equitable Life manages their With-Profits Fund can be found on their website http://www.equitable.co.uk under 'Corporate updates'.