Merchant Navy Ratings Pension Fund - Regulatory intervention report
On 16 December 2020, the Pensions Regulator published its Regulatory Intervention Report in regard to the MNRPF. This document reports on its findings on the governance of the Fund and relates directly to matters highlighted in the communication issued to all members by John Oldland in March 2020 and the update provided in the recent Newsletter to members. Click on the links to see copies of these documents on this website.
Since the Determination Panel hearing on 27 February 2020 the Trustee Board has been working effectively together, in the interests of the MNRPF and its members.
The announcement from the Pensions Regulator confirms the outcome of its investigation and closely aligns with what John Oldland mentioned in his letter.
You can view the Pension Regulators report at: https://www.thepensionsregulator.gov.uk/en/document-library/enforcement-activity/regulatory-intervention-reports/merchant-navy-ratings-pension-fund-regulatory-intervention-report
The Trustee would like to stress that, throughout the difficulties that led to the Determinations Panel hearing and since, the day-to-day affairs of the Fund (e.g. payment of Benefits, collection and investment of contributions, triennial valuation and annual funding update, annual audit, etc.) have continued to be effectively managed by the Trustee, with the assistance of its advisers. So hopefully members have seen little or no change in the routine operation of the MNRPF.
However, we understand that members may have some questions and hope that the following provides you with reassurance to any concerns you may have.
1. Is my pension at risk?
No your pension is not at risk. The MNRPF is well funded and as previously mentioned the day-to-day affairs of the Fund (e.g. payment of Benefits, collection and investment of contributions, triennial valuation and annual funding update, annual audit, etc.) have continued to be effectively managed by the Trustee, with the assistance of its advisers.
2. Do I need to do anything?
No there is nothing for you to do.
3. Can I transfer out?
If you are a deferred member and have not yet retired then transfers out of the Scheme are allowed. For any member considering this option we would very strongly encourage you to take independent regulated financial advice to see if this is an appropriate course of action for you.
4. Are the issues all dealt with?
As outlined in the letter from John Oldland in the Summary Annual Report good progress has been made.
Further appointments are expected to be made to the Trustee Board in the new year. We expect this to happen Q2 2021.
5. Who is paying the £1m of adviser costs? Has this come out of my pension?
No. The costs of running the Fund do not impact the level or amount of your pension.
6. How secure is the Fund?
The Fund is in a good financial position with a successful regime of getting financial contributions from the sponsoring employers. The three-yearly formal valuation process is currently underway and will value the fund as at 31 March 2020 but this process takes many months to complete. The Trustee will write to you again once this process has completed.
7. Who is responsible for the governance issues?
The Trustee Board as a whole is responsible for the governance of the Fund.
Ill Health Retirement – High Court Update
As members will be aware from the recent Summary Annual Report 2020 (also known as the Member Newsletter), a trial was due to be heard in the High Court over 8 days from (or shortly after) 9 November 2020 in relation to the ill-health early retirement (“IHER”) benefits paid by the Fund.
The issues in the case relate to whether IHER benefits paid by the Fund from 1985 onwards were validly introduced and the legal effect of various subsequent changes to those benefits. In particular, from 1991, certain IHER benefits were reduced or suspended, and from 8 October 1993, no further IHER pensions were provided to members leaving service after that date.
However, as a result of ongoing confidential settlement discussions, the Judge agreed to adjourn the trial and put the case on hold for a three month period. This is to allow the parties the necessary time to prepare and hopefully agree detailed settlement terms in this complex matter. The intention is that if settlement terms are agreed, they will be considered for approval by the Judge at a further hearing over two days from (or shortly after) 22 March 2021. The Judge would only approve the settlement if he considers that it is in the interests of the members and employers to do so.
Further information about the proposed settlement will be made available to members and employers in due course.
The Trustee strongly recommends that, where possible, members retain any medical and employment history and/or knowledge about their past health. The Trustee also recommends that where possible, a member's family/dependants also retain knowledge of, and/or records related to, a member's employment and medical history in the event of a member's incapacity or death. This is relevant for all members with service before 8 October 1993 who either have or had IHER benefits or left service through ill-health after that date without taking IHER (at the time of leaving service). This could be relevant whether or not the case settles.
Our free webinar programme
It’s interesting that we live in a world where asking ‘how are you doing?’ has become a bit of a formality. But the world has changed, and never have we put so much importance into the question ‘How are you?’ We hope this finds you safe, well and coping.
Over 13 weeks starting on 6 January 2021, the MNRPF are teaming up with the Wellbeing People to present a free 60 minute webinar every week, covering a wide range of wellbeing topics. These essential live wellbeing webinars are designed to support your mental, physical and emotional wellbeing particularly during these unprecedented times of social distancing and, in all too many cases, self-isolation.
Click here to find out more about the webinars and to register.