UCL (Former Medical Schools) Pension Scheme

1. UCL (Former Medical Schools) Pension Scheme Informal meeting with members on Friday, 13 January 2012 Jack Foster, Director – Special Projects Extn 48223; e-mail: j.foster@ucl.ac.uk

2. Purpose of Meeting • Informal meeting to communicate to members about exploratory work being undertaken by UCL staff • Wish to allay fears that members might have • Have invited the trustee and pensions lawyer to respond to questions • No decisions have been made – UCL is considering the options

3. Sustainability of Scheme • Funding position of scheme has deteriorated over last two valuations • Employer’s contributions 34.3% • Employer’s contribution to administrative costs is £132k p.a. • Compares with employer’s contributions in SAUL of 13% • Backdrop of review of ‘final salary’ schemes generally

4. Review of Future Options • UCL Finance Committee have asked to explore options for the future • Early discussions with SAUL indicate transfer of benefits may be possible • Desire to retain ‘final salary’ link • Desire robust and secure alternative scheme (SAUL has 2,000 UCL members) • SAUL is larger scheme so has the resources to be more a efficient/effective scheme

5. Preferred Option • Accrued pension benefits into SAUL • Benefits converted to SAUL’s basis (i.e. 1/80ths) • The capital value of your past service benefits taken as a whole will not be lost • Future benefits with SAUL accrue under ‘final salary’ rules • If it goes ahead, transfer to occur before 1 July 2012 • Existing UFMS scheme to be wound up at the end

6. The Process • UCL to undertake more preparatory work to see if the preferred option works • If UCL goes ahead, accrued benefits converted to SAUL basis • Formal consultation process started • Members informed individually of conversion rate • Access to independent financial advice paid for by UCL • Individual Member’s CONSENT required to transfer

7. The Process (continued) • Following consultation, final decisions made by trustee and employer • Pension Fund assets used to buy-out policies of pensioner/deferred members • Payment to SAUL for liabilities of ‘actives’ • If the process moves forward, UCL would make good any deficit and the trustee would decide how any surplus is used

8. Non-consenting Members • A decision not to consent will result in cessation of future benefit accrual • Past benefits treated as for deferred member • Deferred benefit obligation bought-out with insurer • Member to make arrangements for pensionable service with USS/SAUL (CARE schemes)