CARRIER (UK) PENSION SCHEME YEAR ENDED 31 DECEMBER 2020
TRUSTEE’S REPORT
Introduction
The Trustee is pleased to present its report on the Carrier (UK) Pension Scheme ("the Scheme") for the year ended 31 December 2020.
The Scheme was established on 30 April 1976 to provide benefits to relevant employees of the Principal and Participating Employers.
The Scheme closed to new members with effect from 1 May 2006.
In accordance with HMRC requirements the Scheme is registered under Chapter 2, Part 4 of the Finance Act 2004. As a consequence employer contributions are normally eligible for tax relief and income and capital gains earned by the Scheme receive preferential tax treatment. The Scheme is governed by the Trust Deed and Rules and is a defined benefit arrangement. All members of the Scheme were contracted-out of the State Second Pension, up until 6 April 2016 when contracting-out by final salary pension schemes was abolished by the Government.
The only changes to the Scheme’s trust deed and rules in 2020 comprised a deed of amendment which was executed on 24 February 2020 to amend the Scheme’s termination and winding-up provisions.
Closure of the Scheme to the Future Accrual of Benefits
As reported in the previous year, the Participating Employers of the Scheme commenced consultation with active members in September 2019 with regard to a proposal to close the Scheme to the future accrual of benefits. The consultation process concluded in November 2019, following a 60 day consultation period as required by law. Following a period of reflection the Participating Employers decided to proceed with the closure with effect from 31 March 2020. The affected members were informed of this decision in notices issued by the Participating Employers in December 2019. The Principal Employer issued a formal notice of closure of the Scheme to the future accrual of benefits to the Trustee on 26 February 2020. As a consequence from 31 March 2020 no further benefits will accrue in the Scheme.
Trustee
The Trustee of the Scheme is a company called Carrier Pension Trustee Limited (‘the Trustee’). The directors of the Trustee company have essentially the same responsibilities as if they were individual trustees. In accordance with the Trust Deed, the Trustee is appointed and may be dismissed by the Principal Employer. The Trustee has responsibility for setting the investment strategy and for managing the Scheme, and the directors usually meet four times a year for this purpose. Further or fewer meetings may be scheduled depending on matters requiring consideration by the Trustee during the year. All occupational pension schemes must implement arrangements that provide for at least one-third of the total number of directors of the Trustee company to be member-nominated. The arrangements for the nomination and selection must be proportionate, fair and transparent. The board of the Trustee currently comprises of five trustee directors as shown on page 2. Two of these individuals are appointed by the Scheme’s membership and three are appointed by the Principal Employer of the Scheme. The Trustee periodically reviews registers of risks and conflicts to ensure that appropriate internal controls are in place and remain effective and have appointed professional advisers to support them in delivering the Scheme objectives. These professionals are detailed on page 2.
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