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British American Tobacco UK Pension Fund
British American Tobacco UK
Pension Fund
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The
BAT UK Pension Fund
is run by
British American Tobacco UK Pension Fund Trustee
Limited (a Trust Company)
, which is quite separate from
British American Tobacco plc
(BAT)
. Once contributions have been paid into the Fund by BAT, they are legally ‘owned’ by
the Trust Company and are held entirely separately from BAT’s funds. The directors of the
Trust Company
(
Trustee Directors
) are responsible for managing the Fund, investing the
contributions and ensuring the Scheme is run in a professional and business-like manner,
keeping pace with the latest thinking and industry best practice. They have an obligation to
act honestly and prudently, representing the interests of members of the Fund.
Contents
History
2002 -
BAT UK Pension Fund
is created from the merger of
the
Rothmans International UK Pension Fund
and the
BAT Pension Scheme
.
- The first edition of FYI is issued.
2005 - Following the 2005 formal valuation, employer contributions
to the
DB Section
increase as a result of increases in
life expectancy for non-retired members.
- The
DC Section
is set up and the
DB Section
is closed to
new members.
- Risk register established to identify key risks and introduce
controls to mitigate those risks.
2006 - A
Member charter
is issued setting out the
Trustee’s
commitment to members and outlining the
Trustee’s
strong
focus on quality communication (such as FYI magazine!).
- An extensive communication programme is carried out
as a result of the introduction of the
Annual and Lifetime
Allowance
(tax-free limits to pension increases and lifetime
pension savings).
2008 - Switch to a new third party administrator (not a trivial
exercise) which is now delivering strong performance.
- Review of
DC Section
kicks off leading to implementation of
recent changes.
- Establishment of the fast response committee / swaps
monitoring group (still upper quartile best practice).
- There is a material increase in employer contributions to the
DB Section
following the 2008 formal valuation.
2009 -
ATC
pension scheme becomes part of the
BAT UK Pension
Fund DB Section.
- Launch of the new
BAT UK Pension Fund
website for
DB
Section
members:
- A process for reviewing the Company covenant (its
willingness and ability to support the Fund) is developed that
uses existing expertise with the comfort of external review, in
line with best practice.
2010 -
extended to cover
DC members
.
- A complete overhaul of the
DC section
and investment
strategy.
- A review of
Fund
governance and responsibilities of the
subcommittees.
- Data cleansing exercise undertaken to improve the quality of
the member data held by the Trustee.
- Agreed changes to
DB investment strategy
.
2011 - External review of covenant undertaken.
- Following the 2011 formal valuation, there is a material
increase in employer contributions to the
DB Section
as a
result of significant rises to life expectancy.
- A thorough and complete de-risking proposal is agreed with
good engagement with the
Company
.
- A long-term funding target proposed.
Key milestones for the Fund
WikipensioN
The
BAT UK
Pension Fund
provides pensions
for over 15,000
employees and
former employees of
Rothmans
,
ATC
and
BAT.
With assets in
excess of
£2 billion
running the
Fund
is a
serious business.
1. History
2. Running the Fund
3. The strength of the covenant
