Docusign Envelope ID: 7C50003C-051D-4E0C-907A-F452AD5C4EA2
UNITED TECHNOLOGIES CORPORATION (UK) PENSION SCHEME YEAR ENDED 31 DECEMBER 2023
STATEMENT REGARDING DC GOVERNANCE
The service level agreement (SLA) in place with the administrators covers the processing of contributions, investment of contributions, payments into and out of the Scheme and responses to general member enquiries. During the Scheme year, core financial transactions encompassed:
investment switches – SLA of 3 Business Days; and payments out of the Scheme (i.e. transfer-out or retirement payment) - SLA of 5 Business Days.
A summary of Mercer & Scottish Widows’ performance against SLAs is summ arised in the table below:
Core Financial Transaction
Monthly SLA Performance
Jan 23
Feb 23
Mar 23
Apr 23
May 23
Jun 23
Jul 23
Aug 23
Sep 23
Oct 23
Nov 23
Dec 23
Investment Switches Payments Out
-
-
-
-
-
-
-
-
-
-
-
-
100%
-
- 100% 75% 100% 100% 100% 67% 100% 100% 100%
The administrator provides quarterly reports to detail the service performance in each of these areas, relative to the SLAs in place. The Trustee monitors compliance with these service levels as well as any complaints raised by members or issues identified in terms of the accuracy of core financial transactions during dedicated Benefit Sub-Committee meetings, as well as regular Trustee meetings.
AVCs
The vast majority of transactions relating to the Scheme’s AVCs are undertaken on the Trustee’s behalf by Scottish Widows. The Trustee has agreed service levels with Scottish Widows, both in terms of timeliness and accuracy against those service levels, covering the processing of contributions, investment of contributions, payments into and out of the Scheme and responses to general member enquiries. Scottish Widows (via Mercer) provide quarterly reports to detail the service performance in each of these areas, relative to the service level agreements in place. The Trustee monitors compliance with the service levels alongside that of TACC benefits at regular Benefit Sub-Committee and Trustee meetings. In relation to AVCs held with Legal & General, the Trustee has delegated administrative oversight to Buck who report back to the Trustee on its performance against SLAs part of its quarterly reporting to both the Benefits Sub-Committee and regular Trustee meetings. There are no formal SLAs in place with the Scheme’s other AVC providers, however the Scheme’s administrators report back to the Trustee with any specific issues relating to the administration of the separate AVC policies.
Issues occurring during the year
Concerns over Mercer’s administrative performance were raised prior to and throughout the Scheme Year and, in some cases, have been ongoing for some time. A large number of complaints had been received both in relation to the timeliness and accuracy of the administration service provided and so the Trustee has reviewed the complaints lodged on a case-by-case basis to ensure these are resolved in good time. Despite an improvement in Mercer’s performance, the Trustee has decided to transfer the administration of the Scheme’s TACC benefits and AVCs invested with Scottish Widows to Buck, the Scheme’s other incumbent administrator. The Trustee has worked with its advisers, Mercer and Buck to facilitate the transfer of the Scheme’s administration with effect from June 2024.
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