Focus on Maritime Pensions February 2023

A message from the National Secretary, Darren Procter

The Maritime Pensions Campaign has been running since November 2019 and while this initiative has put pensions on the Maritime agenda, something I believe was lacking when I became National Secretary in 2018, I fully recognise that as a union we need to be doing more to improve all Maritime members retirement outcomes.

However, to improve our members’ workplace pensions we also need to put in place a long lasting and vibrant strategy which aims at improving not only our representatives understanding of an often “marmite” subject but also our members. Therefore, over the next year we will be promoting and engaging directly with our members via four pension newsletters starting with this one and a dedicated Maritime three-day pension course to be held at the RMT Educational Centre in Doncaster.

We will also be engaging with Maritime employers to seek pension improvements and hold workplace meetings with our members to discuss pensions. The RMT Pension Officer, Paul Norris, and I will be in attendance at these meetings to talk pensions and answer your questions.

While this campaign is predominantly about improving and developing pension understanding across the maritime section of the union we also will continue to challenge those employers who breach Auto Enrolment legislation either by not enrolling their employees into a qualifying occupational pension scheme or by employing non-UK low paid seafarers to avoid their statutory obligations. I can advise that we have already brought to the attention of the Pensions Regulator such breaches and will use the RMT Parliamentary Group to expose those employers who exploit non-UK workers to avoid their pension obligation and indeed paying the National Minimum Wage.

2023 will no doubt be another challenging year for many workers across RMT but if we can gain the

pension improvements and understanding we are striving for then the long term future will be a better place for our maritime members.

Darren Proctor, National Secretary

Ensign Retirement Plan to be taken over by Smart Pensions

Ensign Retirement Plan “the Plan” in respect of takeover of this occupational pension scheme by Smart Pensions.

I would advise that the takeover of the Plan is a classed as a “listed change” under the Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006 (the main regulations) and therefore participating employers, such as Stena are expected to consult with employees and their representatives.

It has recently come to the attention of RMT that the Ensign Retirement Plan (ERP) will be taken over by Smart Pensions in the early part of 2023. The ERP is a Defined Contribution (DC) occupational pension scheme arrangement which is offered to employees working at shipping companies such as Stena Line, Northlink Ferries, PNTL and Foreland Shipping.

We are advised that over the past year the Ensign Trustees have been reviewing ERP in respect to costs and more importantly members are receiving value for money. The latter point is very important when it comes to DC arrangement as members potential retirement benefits are based on the amount of contributions going into their individual pension pot, the level of investment returns they receive over the lifetime of their membership of the ERP and level of charges deducted from their pot every year to administer the plan i.e. Annual Management Charges.

Following the review and carrying out detailed due diligence, the Trustees have decided that it would be in the best interests of members current and future retirement benefits that the ERP

is wound up and that members benefits are transferred to Smart Pension. The Smart Pension Scheme is a Master Trust arrangement which offers comparable benefits as those offered to members currently contributing to the ERP.

I can advise that following correspondence from Stena Line management we are advised that they have started a statutory 60-day consultation period with their employees who contribute to the

Having approached another participating employer of the Plan, Northlink Ferries, they have also started a statutory consultation with their employees which started on 27th December 2022.

Further RMT has recently been in contact with the Chair of the ERP and asked several questions in respect of the takeover by Smart Pensions. RMT recently sent an email to our members employed by participating employers of the ERP and also a circular to Shipping Branches containing these questions as well as other information.

To view this information please click here

https://bit.ly/3vZqIOw

We will keep you updated on developments.

Merchant Navy Ratings Pension Fund (MNRPF) Trustee Report

As reported in the January/February 2022 edition of the Maritime Pensions Campaign newsletter the structure of MNRPF Trustee Board was due to move from five board members to three Independent Trustees. Each of the Nominating Bodies, RMT and the Employers Group, nominated one of the three Independent Trustees with third, the Chair of the Trustee Board, being nominated by the Maritimes Pensions Forum which is made up of representatives of RMT and the Employers Group.

RMT nominated Lionel Sampson who is employed by the Trade Union the CWU and is an experienced pension trustee on many other schemes. Lionel, below, gives his first report for the Maritime Pension Campaign Newsletter on how the MNRPF Trustee Board has operated since the transition to three trustees’ took place on 1st October 2022.

“ It’s been just over a year since RMT nominated me as an Independent Trustee of the Merchant Navy Ratings Pension Fund (MNRPF) and, with my fellow Trustees, that year has been very hectic and has dealt with some very important issues.

By way of background, I have been involved in pension schemes as a Trustee for over 25 years and I am also a Senior Policy Advisor to the General Secretary of the Communication Workers Union.

The MNRPF Trustee Board has changed and I would have to say a massive thank you to the former Trustees for their support and help in

dealing with the transition. We would not have been able to introduce the new arrangement without their help or support.

Some of the key issues we are dealing with and are dominating the Trustee agenda are reviewing the cost of running the scheme, dealing with day to day issues in a timely way and ensuring that the membership of the scheme are front and centre when it comes to all decision making.

The MNRPF is not a small fund with net assets of £1,202,701 and a total membership of 17,727. There is a lot of work to be done to keep the fund on the road.

There are a number of important projects being dealt with by the Trustees and one of the most

important projects is the work in implementing the settlement on ill health early retirement benefits referred to as “Project Greenwich”. Hundreds of members have been communicated with and are now being processed and are receiving correct pension and payments for the money owed from previous years with interest paid on top.

Other projects are also underway which will take up our time but in essence these are all about ensuring members receive the correct pension.

An important role for the Trustees is improving the communications with our members. We are revamping the members newsletter – it needs to be shorter and free of jargon. As members your input in the project will be welcomed. We are also looking at redesigning the website and make it easier to access and provide more comprehensive information about the fund.

My first year as an Independent Trustee in the MNRPF has been a revelation. I believe the scheme is being managed and run in a professional way.”

You can read the latest newsletter and ask questions about your MNRPF pension online at www.mnrpf.co.uk/library.php

Lionel Sampson, RMT nominated MNRPF Independent Trustee Director

Do you need help with a pension problem or understanding your pension?

RMT receives daily communication from RMT members with either problems they are having with their employer’s occupational pension scheme or are simply confused by the jargon which is often used by pension providers etc which makes it difficult to understand their pension.

While problems can be resolved by members directly engaging with their employer or the pension provider, often members need assistance. Therefore, if you need help or just advice, other than financial, the union can assist.

Our dedicated Pensions officer has recently helped a number of individuals in various pensions schemes and if members are experiencing any difficulties with claiming your benefits, you think your benefits are wrong or you think your employer is not paying the correct level of contributions into your pension your union is here to assist you in these matters.

If you have a pension problem or just needs some pension understanding please get in contact with RMT Pensions Officer, Paul Norris on 020 7529 8806 or at p.norris@rmt.org.uk

Please be advised RMT cannot give you financial advice.

Pension Checklist

n3 CHECK you have completed an Expression of Wish Form and that it is up to date (see below).

Does your employer have more than one Defined Contribution (DC) pension arrangement? If so CHECK that you are contributing to the DC scheme that offers the highest employer contributions and highest level of Life Cover (see below).

n3 CHECK that the DC pension scheme’s Annual Management Charge (AMC) is giving you value for money.

AMC’s vary but generally they will be below 0.75% pa. Even a small percentage can increase or reduce your DC pension pot so CHECK and if your considering changing arrangement contact the scheme administrator or contact RMT for assistance.

Education Corner

What is the difference between a Defined Contribution (DC) and Defined Benefits (DB) pension scheme?

Defined Contribution (DC)

DC pension schemes, sometime called ‘money purchase’ are the most common occupational pension arrangement across the maritime industry and indeed the UK in general. Retirement benefits are based on the money paid in by you and your employer which is then invested by the relevant pension provider. The value of your pension pot can go up or down depending on how the investments perform. Therefore, depending in the size of your pension pot will dictate the benefits you will receive.

The key to DC is the higher the amount of contributions going into a members pension pot the better chance of receiving decent retirement benefits at retirement.

Life Cover

Defined Benefits (DB)

DB pension schemes work completely the other way to DC as members during their working life know what they are roughly going to receive as their benefits are based on their pensionable service and pay. This known as the “DB Promise”.

Most DB pension schemes have a set level of contributions and although contributions can go up or down members are still given a promise of certain level of contributions at retirement.

Life cover is an important element of being a member of a pension scheme but simply, if you are not in an occupational pension scheme it is almost certain that your family is not protected financially in the event of your death unless you have your own personal cover.

While it is important that members are in their employer’s pension scheme in the first place it’s just as important that members are aware of the level of life cover available to them by being a member of an occupational pension scheme. This is because we are aware that some employers will offer, as an example, two-years basic salary

lump payment to dependants in one pension scheme and three-year basic salary in another, if the employer has more than one arrangement.

However, while we urge our members to check with their employer on the level of life cover offered, we would advise that RMT will be directly approaching all employers who don’t offer at least three times death in service cover to increase it to at least three times basic salary. We will also be demanding, where an employer has more than one pension arrangement, that the level of cover is again at least three times basic pay regardless of the arrangement offered.

Expression of wish form

If you have life cover, you should have completed an Expression of Wish form. This form indicates where you would like the lump sum death in service payment to be paid to in the event of your death.

While the Expression of Wish form can be overridden by other documents, such as a will as an example, it is wise that members have completed this form and that it is kept up to date. Failure to complete or update the form can result in delays in the funds being paid to loved ones and potentially being paid to the wrong dependants.

MNRPF – Ill Health Court Case

Since the 1st July 2022 these benefits have started to be paid out to members and following correspondence from the MNRPF Trustee Board we can report the following:

There are three categories of members who may be entitled to additional benefits:

Category A/B

Category A/B members are those who retired on an IHER pension on or after November 1989 and before 8 October 1993, and had an IHER pension either: n scaled back on retirement; and/or n their benefits reviewed after it came into payment and as a result was reduced or suspended.

We are advised that letters were sent out in June 2022 and August 2022 to Category A/B members proving details of the uplift in their pension. The Trustee wrote a final letter at the beginning of December provided details of how the payments would be made including tax issues.

Payments due to the estates for deceased members and deceased spouses

Following a tracing exercise carried out by the administrators of the MNRPF, Mercer, the Trustee is in the process of starting to contact close family of the deceased member to request details of the legal personal representatives of the estates of former members. This is to obtain the required information to make payments.

Category C

Category C are members who: n were in service on 8 October 1993, and had been in service long enough at that time to have qualified for an IHER pension (had new IHER pensions not been stopped on 8 October 1993); and n left service before Normal Pension Age due to permanent unfitness for sea service at the time they left service.

As part of the settlement agreement, it

was agreed that three independent Appointed Persons would review the cases so that the Trustees could consider appeals made by members. Some cases considered by the Appointed Persons are randomly referred back to the Trustees so that they can consider whether or not the decisions are correct consistent.

The table below sets out the number of Category C cases that have been reviewed by the Appointed Persons up to 30th November 2022:

In respect of Category C members, the Trustee wrote to potential members who still have benefits in the Fund, to provide them with details of how to make a claim if they believed that they may be eligible. As required under the settlement, Mercer has written chasing letters for a third time to those members who have not yet responded. We will keep you informed of developments.

If members need further information about IHER benefits or anything else they should contact Mercer: Freephone helpline: 0800 197 6923.

House, Talbot Road, Stretford, Manchester M32 0FP. or by email mnrpf.mailings@mercer.com

As reported in the June/July 2022 Maritime Pensions Campaign Newsletter, following the conclusion of the MNRPF Ill Health Early Retirement (IHER) Court Case in February 2022, over 8,000 members and dependants will receive additional benefits because of detrimental changes made to IHER rules back in the early 1990’s.

RMT Maritime Pension Champions Needed!

Do you have an interest in pensions? If so, we need you.

Like our seafarer and health and safety representatives we need Pension Champions to not just assist members on their occupational pension options but to also develop their own understanding and knowledge of this important subject.

As we have already stated we want pensions to be at the forefront of our members terms and conditions and the only way this can be achieved is for our representatives to understand the importance of pensions and to understand their workplace pension and their entitlement. While we don’t expect individuals to be complete experts in this oftenunnecessary complex subject we want individuals to be comfortable with their own pension arrangement and where they can seek advice if

Therefore, we want our representatives and/or members to come forward and be our “RMT Maritime Pension Champions”.

While in its infancy we want RMT Maritime Pension Champions to support our members in the workplace to assist members with their pension questions and

while you would not be able to give financial advice, we want our members to understand their occupational retirement benefits options.

To assist in this role we intend to hold a three day pension course later this year at the Bob Crow Education Centre, Doncaster, which will purely focused on Maritime Pensions. At the end of the course, we would hope that interested members or representatives will have the basic understanding of what a pension is and what arrangements are available in their workplace.

RMT Maritime Pension Champions will receive the full support of the union and assistance when and if required.

If you would like to attend this course or indeed have some views, comments, or questions in relation to pensions please contact RMT Pensions Officer, Paul Norris, at p.norris@rmt.org.uk or ring him on 020 7529 8806.

For more information on the Maritime Pensions Campaign and to view past newsletters, please click here: http://bit.ly/3rL8cad