THE UNILEVER PENSION FUND Pensioners News · PENSIONERS NEWS PENSIONERS NEWS PENSIONERS NEWS...

Welcome to the September edition of ‘Pensioners News’.

Inside this edition...

Delegates Conference 2000 – page 2 Pension increase – page 3 Looking after the fund’s assets – page 4 Spotlight on Unilever – page 5

Pensioners NewsTHE UNILEVER PENSION FUND

SEPTEMBER 2000

P E N S I O N F U N D

2

For the second year running, pensioner visitorswere invited to attend either the PensionersConference or the UPF Delegates Conference2000. In the May issue of ‘Pensioners News’ wewrote about the Pensioners Conference. Ourreport on the Delegates Conference, which washeld at the ICC in Birmingham, follows below.

The Delegates Conference gives an opportunity foremployee members (who are elected by theirpeers) to discuss specific fund developments as wellas pensions in general. This year the conferencecentred mainly on the switch from the USF to theUPF, explaining the rationale behind, and thebenefits resulting from, the change.

Although the annualPensioners Conference hasbeen established, 10 pensioner visitorsattended the DelegatesConference. RichardGreenhalgh (Chairman ofthe Trustee Board)commented in his openingremarks that retaining apensioner presence at theDelegates Conference adds an important extradimension.

The pensioner visitors attended a dinner on theevening before the main conference, at which theywere able to share their ideas and concerns on aninformal basis with Cynthia Elliott, Pensioners

Liaison Manager, and somemembers of UK PensionsDepartment (UKPD)Management Team.

The first speaker at theconference itself was JacquiLait MP, the Conservativefront bench spokespersonfor pensions. Jacqui gaveher perspective on thecurrent pensions scene, and

outlined the shape of future Conservative pensionspolicy. Of particular interest to many of thedelegates were her views on long-term healthcareand the difficulty many people experience inaffording such care in retirement.

Chris Lewin, Head of UK Pensions, then updatedthe delegates on developments in the pensionsworld over the last year and issues likely to emergein the future. In particular, Chris gave details of

stakeholder pensions andthe recently publishedregulations regardingpension sharing on divorce.

Unfortunately Wendy Mayall(Chief Investment Officer)could not join us this year topresent the investmentreport, but Philip Lambert,Head of Unilever CorporatePensions Division, stepped in and did a sterlingjob. Philip reported that the fund’s investmentscontinue to perform well. Further details of thefund’s investments are given on page 4.

After tea, Chris Lewin explained the stagesinvolved in the Actuarial Valuation. The leafletentitled ‘Interview with the Actuary’, which wassent to all fund members inNovember last year, givesdetails of the process.

In the evening, over dinner,the delegates and pensionervisitors took the opportunityto discuss the events of theday with some of the Trusteesand the UKPD ManagementTeam.

The next day Chris Tripp,Actuarial Manager, and Christine Drury, one of theTrustees, explained the proposals for the newstructure of the Trustee Board and theconstitutional changes to the fund.

Kim Northwood, Service Delivery Manager, and I then gave a short presentation on customerservice.

At the end of the conference, delegates presentedtheir feedback to the UKPD Management Team onthe issues considered. The team responded to thequestions asked by the delegates before thediscussion widened to encompass furtherquestions. Most of the points raised by thedelegates focused on matters close to the hearts ofemployee members.

Since the structure of the Trustee Board isundergoing change, this year’s conference waslikely to be the last one when the delegates arefrom 3 areas. There was a feeling that we werecoming to the end of an era, but this was mixedwith an air of anticipation as we look forward withconfidence to the future.

PENSIONERS AT DELEGATES CONFERENCE 2000PENSIONERS NEWS PENSIONERS NEWS PENSIONERS NEWS PENSIONERS NEWS

Jacqui Lait

Chris Lewin

Richard Greenhalgh

Philip Lambert

by Hannah Clarke Communications Manager

PENSIONERS NEWS PENSIONERS NEWS PENSIONERS NEWS PENSIONERS NEWS

PENSION INCREASE 2000 – 3.3%In October, pensions above the GuaranteedMinimum Pension (see table) will be increasedusing the annual increase in the Retail Prices Indexpublished in August. If you left after 1 October1999 the percentage is reduced proportionately.

Why use the RPI? John Wilcock, Financial Controller, explains:

Last year a number of pensioners asked me why weuse the RPI, which includes mortgage interestpayments, rather than the RPIX which excludesmortgage interest. RPIX is the government’spreferred indicator for managing the economy. Atthe time the RPI increase was at a historically lowlevel of 1.3% whereas the RPIX figure was 2.2%. Itwas suggested that, since most pensioners havealready paid off their mortgages, they were beingunfairly penalised.

This year, while the RPI increase is 3.3% the RPIXfigure is again 2.2%. The reason for this is that therecent trend in interest rates has been upwards.During this phase of the interest rate cycle,

mortgage costs (for those who have mortgages)tend to increase and the RPI will generally behigher than the RPIX. But once the cycle turns andinterest rates start to fall, the reverse is true and theRPIX will tend to be higher than the RPI increase.This was the situation 12 months ago. The graphbelow shows the relationship between the 2 ratesover the last 13 years. Over the full interest ratecycle there will be very little difference on acumulative basis between the increase measured bythe RPI and RPIX.

Finally, for anyone who remains unconvinced, I should add that the fund rules stipulate the use ofthe RPI increase.

%10

8

6

4

2

01988

RPI RPIX

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

3

Over the last few months, I have spent most of mytime out on the road, meeting many of you. In May I visited the Wirral where I attended pensionerslunches and asked for volunteers to help set up apilot regional group for pensioners. We intend toencourage the setting up of these groups to cover thewhole of the UK over the next 3 years.

The groups are not intended to replace the UnileverPensioners Association. Their purpose is to:

❖ give those who wish to do so the opportunity totake part in social events

❖ improve communications with both the Companyand the Unilever Pension Fund.

The Chairpeople of the groups would be invited toattend the annual Pensioners Conference in London

where they would have the opportunity to putforward the views of their fellow pensioners to theTrustees and the UKPD Management Team. If youwould like to be involved in the setting up orrunning of these groups I would be delighted to hearfrom you.

For more information you can contact me by letteror e-mail or call me on 020 7822 5863. Please notethat, as I am often out on the road, it may take timeto reply to your queries.

Cynthia Elliott, Pensioners Liaison ManagerUK Pensions DepartmentUnilever HouseBlackfriars, London EC4P 4BQ

e-mail: [email protected]

NEW INITIATIVES by Cynthia Elliott, Pensioners Liaison Manager

Pension Increase 3.3%

Before Unilever Afterthe increase the

increase 3.3% increase£ £ £

UPF 1,000 33 1,033

UPF/GMP 300 – 300

Total UPF 1,300 33 1,333

4

LOOKING AFTER THE FUND’S ASSETSAn interview with Wendy Mayall, Chief Investment Officer

The 28th Trustee Report and Accounts for the USFhas now been audited and copies are available onrequest from UKPD. One of the questions peoplefrequently ask, when they consider the Report andAccounts, and the fund investment is “Who makesthe investment decisions for the fund?” To answerthis question, we interviewed the fund’s ChiefInvestment Officer, Wendy Mayall.

PN (Pensioners News) Wendy, we all know that theTrustees have a duty to obtain the best possiblereturns when investing the fund’s assets. How do theTrustees fulfil this duty?

WM (Wendy Mayall) The Trustees do have thisobligation, although the phrase “best possiblereturns” also means that they have to consider otherfactors. For example, they should not take excessiverisks to achieve outstanding returns.

As you know, the fund has between £4.5 billion and £5 billion in assets – bigger than the Gross DomesticProduct of the Bahamas – and the Trustees haverecognised that the investment of the fund’s moniescalls for specialist expertise. They have, therefore,delegated some of the supervision of the investmentprocess to the Investment Committee.

PN Who sits on the Investment Committee?WM Patrick Cescau (Unilever’s Financial Director),chairs the committee, which comprises 2 of theTrustees: Christine Drury and David Jones, JeffreyAllgrove (Unilever’s Controller), Philip Lambertand Chris Lewin, as well as myself. There is also anexternal advisory member, Dr Neil Cross.

PN What is thecommittee’s role?WM Thecommittee suggeststhe investmentstrategy that theTrustees shouldadopt. Once this hasbeen agreed, ourrole is to ensure that it is carried out. This includessupervising the various investment managersappointed by the fund. Although the committeedoes not get involved in the selection of individualstocks and shares, it does keep a close eye on theinvestment managers.

PN How often does the committee meet?WM We meet once a quarter, and also report to thefull Trustee Board at each of their meetings –generally quarterly.

PN What is your role in the process?WM As Chief Investment Officer, I am involved inthe day-to-day business of supervision of the fundinvestments, which includes liaising with theinvestment managers, watching out for trends towhich we may need to respond, being alert topotential trouble spots and ensuring that the fund’sassets continue to be invested efficiently.

PN Thank you, Wendy, that was very interesting.Congratulations on your award (see above)!

This interview took place before the changes in company

structure recently announced by Unilever. We will report

on these changes in the next issue.


The audited Report and Accounts contains moredetails about the USF’s financial activity during the12 months to 31 March 2000.If you would like a copy, please fill in this form and send it to:The Secretary to the USF, UKPD, Unilever House,Blackfriars, London EC4P 4BQ.Please send me a copy of the 28th USF Report andAccounts (PLEASE USE BLOCK CAPITALS)

Name:

Pension record no:

Address:

Postcode:

USF REPORT AND ACCOUNTS

Wendy Mayall receiving the award for“Outstanding Alumna 2000” fromUniversity of Manchester Institute ofScience and Technology

SPLIT BETWEEN INVESTMENT CLASSES AT 31 MARCH 2000

Venture capital 2%

Property 6%

Pacific/Emerging Equities 12%

Fixed Interest 12%

Cash 3%

UK Equities 37%

US/Europe/Japan Equities 28%

SIZE OF FUND

Net assets of fund at 31 March 2000 £4,901m

Net assets of fund at 31 March 1999 £4,242m


Welcome to “Spotlight on Unilever”, where we turnour attention to one particular company or site.This new addition to ‘Pensioners News’ is inresponse to your requests to learn more aboutUnilever’s businesses and their plans. We start offwith Birds Eye Wall’s, Lowestoft, which celebratedits 50th anniversary in 1999.

Prior to 1949, part of the Lowestoft site had beenused by MacFisheries for herring curing during thewinter. The factory began its work for Birds Eye in1949, making cartons during the summer monthsfor the fruit picked in the area. The fruit waspacked at Lowestoft and then sent to GreatYarmouth for freezing. It wasn’t until 1951 thatfood was actually frozen at the site.

The site went from strength tostrength, expanding the range ofproducts and in turn the number ofbuildings. Pastry and sausage rollproduction started in the 1960s, andin the 1970s a new Repack Department was built.

In 1981, Birds Eye Foods merged with Wall’s Ice Cream Ltd, to form Birds Eye Wall’s Ltd and in1985, with the closure of the Great Yarmouthfactory, Lowestoft took over the production ofWaffles and Burgers, leading to the construction ofa new Steakhouse Building. In 1991, testproduction of white meat products such asChicken Burgers started. The products provedsuch a success that in 1993 a new building for whitemeats was opened.

In 1996, the site started to operate 24 hours a day, 7 days a week, and greater emphasis is now placedon team working, problem solving and TotalProductive Maintenance (TPM). Traditional roleshave changed, as all employees are now involved inthe smooth running of the production line.Process workers are now trained to be able to carry

out minor engineering tasks on the productionlines, freeing engineers to take on more detailedtechnical aspects of machine care anddevelopment.

1999 saw the opening of a new frozen fooddevelopment centre, costing £1m. The centreforms the focus for development activities acrossfrozen foods for Birds Eye. Giving consumers whatthey want is still key to the development of thebusiness, and the centre has facilities which allowconsumers to come in and cook and taste theproducts to give first hand experience of product

performance inthe real world. A panel ofhousewives is alsoretained to giveimpartial productvalidation.

As always, BirdsEye is focused onthe need tocontinue to give

its consumers high quality, trusted food productsand the Lowestoft site, especially with thedevelopment centre, is continuing its tradition ofdoing exactly that.

Thanks to Birds Eye Wall’s for allowing us tofeature the Lowestoft site and for providing theinformation in this article.

SPOTLIGHT ON UNILEVERBIRDS EYE WALL’S, LOWESTOFT

1 12 23 045 58 86x x+= =7 3Number of employees at BEW Lowestoft 1,000

Famous Brands

Crispy Chicken Dippers...Original & Best BeefBurgers...Chicken Curry...Garden Peas...Cod FilletFish Fingers...Potato Waffles

Over 50 new products in the Birds Eye Wall’s rangeare launched every year. 500 million packs of BirdsEye products are made every year – 230 million bythe Lowestoft factory.

FACTS & FIGURES

Then... Whapload Road in the 50s

and now... Birds Eye Wall’s today

The development centre at Lowestoft – givingconsumers what they want

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6

GOVERNMENT RESPONSE TO THE ROYAL COMMISSION ON LONG-TERM CARE

FREE TV LICENCES FOR OVER 75S

TV Licensing enquiry number

0845 602 3334☎ ☎

Are you over age 75 and living in Great Britain?If so, you will qualify for a free TV licence from1 November 2000.

However, residents of theChannel Islands and the Isle ofMan are currently excluded, astheir respective authoritieshave still to make a decision.

Only one resident in thehousehold needs to be overage 75 to qualify, but obviouslythe licence must be in thatperson’s name. It maytherefore be necessary for you to change thename of the licence holder for the property andyou will still need to make sure you renew yourlicence each year.

If you are over 75 now and your current TVlicence expires before 1 November 2000, you

can buy a temporary licence up to this date, atwhich time you should apply for the freelicence. If, however, you are already over age 75

and your licence expires afterNovember, you should apply for yourfree licence from November whenyou will receive a refund for theremaining months of your existinglicence. This information is forguidance only.

TV Licensing will be writing toeveryone with details of how to applyfor the new Over 75 Licence. In the

meantime, if you have any queries relating tothis you should contact TV Licensing on theirspecial telephone enquiry number.

Much debated over the past 2 years at pensionerfunctions and our conferences has been theRoyal Commission on Long-Term Care and howthe government might respond. TheCommission, which reported in 1998,highlighted the problems that elderly peopleexperience when needing long-term care,particularly the distress caused when some arecompelled to sell their houses or use up anysavings to pay for their care needs. A series ofrecommendations was made.

At the end of July the PrimeMinister introduced thegovernment’s plans for theNational Health Service, whichinclude a response to theCommission. Set out below aresome of the more pertinentpoints:

❖ NHS nursing care will befree in all nursing homes byOctober 2001

❖ From April 2001, the valueof the patient’s home will bedisregarded for the purpose

of means testing for the first 3 months afterentry to a nursing home

❖ The limit above which a person has to meettheir own accommodation and personal carecosts will be raised to £18,000 from April2001

❖ The Treasury is to investigate the insuranceproducts available to meet the cost of long-term care. The report is due in autumn 2000.

The government rejected the RoyalCommission’srecommendation that thecost of “personal care”which includes nursing careand some social care tasks,such as help with bathing,should be free.

Copies of the report, “TheNHS Plan” are availablefrom “The StationeryOffice” bookshops, and canalso be found on theinternet –www.nhs.uk/nhsplan.


7

We have received several enquiries about thedifferent categories of fund members so, followinga suggestion from some pensioners, a moredetailed analysis of the pensioner and deferredmembership at 31 March 2000 is given below.

Pensioners – 43,484

All pensioners have transferred to the UPF and thetotal consists of the 3 types of pensions in payment.

Retirement Pensions 30,738Spouse & Dependant Pensions 12,486Child Pensions 260

Deferred pensioners – 48,690

The total is made up of 2 groups, as there are somemembers with full deferred benefits who have lefttheir pension rights in the Fund to be paid whenthey reach retirement age. The other categoryreceived a refund of contributions when theiremployee membership ended and it is a legislativerequirement that we have to provide the equivalentof a very small part of their State Pension. When itbecomes payable they are offered a lump sumsettlement which the vast majority accept, so theydo not join the pensioners payroll.

Prior to the transfer to the UPF at 1 April therewere about 24,000 in each group.The division hasnow changed as the full members have moved tothe new fund along with some of the Stateequivalent members. As a result the UPF hasstarted with 32,043 deferred members, leaving16,647 in the USF.

USF MEMBERSHIP – THE NUMBERS EXPLAINED by Sue Hawes

Total membership at 31 March 1999 – 109,628

The period of nomination of pensionermembers as candidates for election to theTrustee Board of the UPF is now over. Pleasesee the enclosed leaflet for details about theoutcome of the nomination process.

43,426 49,196 17,006

43,484 48,690 15,570

MEMBERSHIP

Total membership at 31 March 2000 – 107,744

PensionersDeferred pensionersEmployee members

STOP PRESS

If you are a member of the Unilever PensionFund, (not including the UNIAC Pension Fundor other overseas arrangement), and were inreceipt of a retirement pension on 31 March2000, you have the option to give up some ofyour own pension to provide extra pension foryour spouse in the event of your death. To datealmost 50% of members who have receivedquotations have taken advantage of the option.

The option expires on 31 December 2000.Therefore, should you wish to take advantage ofthis option, you must request a quote by 15 November 2000 at the latest to allow enoughtime for your application to be processed by theend of December. Please complete and returnthe form at the back of the booklet we sent youin February about the change from the USF to

the UPF, or write to UKPD if you need anotherform.

IMPORTANT REMINDER – LAST CHANCE TO BOOST YOUR SPOUSE’S PENSION

In this edition of ‘Pensioners News’ we enclosethe latest information from Unilever’s PrivateInsurance Department, which we hope you willfind useful. Please note that all queries on thisshould be directed to UK Insurance Department(see the names and numbers on the form) andnot to UKPD.

Last year, we included information about anoffer from SpecSavers Opticians. SpecSavers areplanning to launch a new scheme in January2001, and we hope to include details of this inthe next edition of ‘Pensioners News’.

OFFERS ... OFFERS ... OFFERS ... OFFERS

(BLOCK CAPITALS PLEASE)

Name:

Address:

Postcode:

Pension record no:

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WORDSEARCH

SOME USEFUL PHONE NUMBERS

SPOT THE MISSING PRODUCT!As we continue to receive a positive response to the Wordsearch,we’ve decided to make it a regular feature. This time, though,we’ve added a new twist to the puzzle. Although we have listedbelow only 10 Birds Eye Wall’s products, hidden in the Wordsearchyou will also find an additional 11th mystery product! As before, weare offering £20 Marks & Spencer gift vouchers to each of the first 5 names drawn out of a sack, who correctly identify the 11 Birds Eye Wall’s products in the Wordsearch below (one entry per person; only Unilever pensioners may enter). BRUSSELS SPROUTS, BEEFBURGERS, MIXED VEGETABLES, GARDEN PEAS, POTATOWAFFLES, OVEN CHIPS, SLICED BEANS, ALPHABITES, PETITS POIS, CHICKSTICKSWhen you have completed the Wordsearch, fill in your details in the box, cut it out and send it to:Wordsearch Competition, UKPD, Unilever House, Blackfriars, London EC4P 4BQ to arrive no laterthan 20 October 2000. Please mark the envelope “Wordsearch”.

Congratulations to the winners of theSpring Wordsearch:

Mrs G E Rose from Whitton, MiddlesexMrs D I Cant from Grimsby, North East LincsMrs F M Owen from LiverpoolMr R Owens from Birkenhead,MerseysideMrs V M Redman from Chislehurst, Kent

Unilever Pensioners Administration 020 7822 6949/5093

Unilever Pensioners Association / Unilever Pensioners Liaison 020 7822 5863

Unilever Private Insurance 020 7822 5547/5551

Unilever Pensions Tax Office (Ref 947/V) 0161 261 2000

DSS Enquiry Office 0345 313 233

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S E L B A T E G E V D E X I MD T T F S R B U A S Y L S K PP W U T T W C K L R Q U K I FS S I O P S T I T E P Z C S DN M Q V R C O Q H G T V I E OA L Y E K P P X A R B W T T SE Z L N U Z S R N U Y L S I NB B Y C F G D S H B D K K B AD G H H J E V L L F C B C A EE H J I N K P L T E X A I H BC B K P X J L W Q E S W H P DI O E S N C L D H B F S C L AL A O W K M N I Q B W D U A OS Q U T V C D G H L F D C R RS S E L F F A W O T A T O P B

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