MARCH 2024
MARCH 2024
Welcome to the latest edition of Pension Update, the newsletter of the TotalEnergies UK Pension Plan
Nothing stands still for long, either in the Plan or in the wider world of pensions, so there are plenty of developments to let you know about.
We’ve recently published our Climate Disclosure Report and we’d love you to take a look and see just how much we’re doing to monitor the environmental impact of the Plan’s investments.
We also thought it would be good for you to find out more about the people behind the Plan, so with that in mind we’ve got interviews with Shonagh Anderson, one of my colleagues on the Trustee Board, and Lisa Decieco, a long-term member of the Gallagher administration team.
As a new feature, we’re also introducing some case studies to help you think through your own situation on your journey to retirement. I hope you find these useful.
As ever, I’d like to encourage you to make the most of the online services we provide to help you understand and manage your TotalEnergies pension – in particular the Member Portal, which you can use to review and update your personal details. And don’t forget the new pensions app! Details of how to access these services are provided at the end of the newsletter.
Rob White
Chair of TotalEnergies Pension Trustee UK Limited
We thought you’d like to find out a bit more about some of the people responsible for running the Plan, so we’ve interviewed one of our Trustee Directors and one of our administrators to give you a glimpse behind the scenes.
Shonagh Anderson
Member-Nominated Trustee Director (MNTD)
Shonagh joined the Trustee Board last year as a result of the MNTD exercise we ran in the spring. Here she tells us about her experience so far…
All the Trustee Directors are members of one or more sub-committees which meet several times a year to follow certain issues in detail and make recommendations and reports to the full Board. This means there is a regular cycle of preparing for meetings by reading the agenda and meeting papers to understand the issues and note any questions to ask in the meeting, participating in the meetings, and reviewing the minutes afterwards. The Chair has some additional activity to prepare the meeting agenda with the UK Pensions Department, chair the meeting and present the subcommittee report to the Board. There is also time spent keeping up to date with developments in pension law and regulation through formal training as well as regular pensions updates from our advisers.
I was surprised by the number of advisers that are required under pension regulations: actuaries, lawyers, investment advisers. It was a bit overwhelming to meet them all when I went to my first Board meeting and annual training day! I am really impressed by their knowledge and professionalism, as well as their patience in answering Trustee Directors' questions to be sure that we understand the often complex subjects that the Board has to manage.
It's never too early to learn about your pension and how it can contribute to your retirement plans! So I would encourage members to use the resources and information on the TotalEnergies pension website to keep themselves up to date on how their pension works and the key decisions that they need to take before and at retirement.
Lisa Decieco
Team Leader
Lisa is one of the longest-serving members of the Gallagher team. Here she tells us a little more about what that involves, and what changes she’s seen during her time working with the Plan…
Predominantly, this involves answering member requests that have been received via a phone call, email, the Member Portal or by post. These can be anything from questions about how the Plan works, to requests to transfer benefits — which means that no two days are the same!
I started working on the Plan in June 2010. There have been a lot of changes in that time, the biggest being during 2021 when we had the sale of Lindsey Oil Refinery and the closure of the DB scheme to future accruals. The pensions landscape is always changing so we have to keep up-to-date with the latest industry news and developments as well.
The public website (pensioninfo.totalenergies.uk) is a good source of information and links through to the Member Portal.
The Plan also has an appointed firm of advisers — WPSA — who offer one round of free advice when you are looking to take your benefits. This is a service funded by the Plan Trustee to assist you with the important decision you need to make about your future income, so I recommend you take advantage of it when the time comes.
I like to spend time with my family travelling the UK in our caravan, and going out for motorbike rides with my husband.
Sometimes it can be helpful to view your pension through the lens of someone else who’s in a comparable position. We’ve therefore provided a couple of examples of typical members who might be facing some of the same questions and decisions as you.
Remember: we can’t give you financial advice. These case studies are just examples to help you think through the issues. You should carefully consider your own personal circumstances and think about taking independent financial advice before making any major decisions regarding your pension.
You can get general guidance and information about pensions via MoneyHelper, a free service provided by the government. MoneyHelper can also help you to find an Independent Financial Adviser in your area. Go to moneyhelper.org.uk to get started.
“Hello, I’m Therese. I’m 54 years old and I’ve got savings in both the Defined Benefit and Defined Contribution sections of the Plan. I’m just starting to think in detail about my retirement options and what to do with the money I’ve saved.”
What we’d say to Therese:
Make sure you understand the differences between your DB and DC pensions, including the different options for how you take them:
Your DB pension is based on your salary and your length of service as a member. The key decisions you need to make are:
Your DC pension is based on the value of your DC savings – to even call it a “pension” is a bit misleading. The key decisions you need to make are:
“Hello. I’m Edward. I’m 70 years old and I’m receiving a pension from the Plan after working for TotalEnergies for 15 years in the 1980s and 1990s. I’m trying to do some estate planning and I want to make sure all my records are in order.”
What we’d say to Edward:
Every three years, our actuary is required to undertake a full valuation of the Plan to see how its assets (the money it has) compare to its liabilities (the money it will require in order to pay benefits now and in the future). A new valuation, based on data at 30 June 2023, is currently being finalised and we’ll report the results to you when they’re available.
We reported the results of the previous actuarial update (at 30 June 2022) in our last newsletter, but by way of reminder, at 30 June 2022 the DB Section of the Plan had assets of £2,709 million against estimated liabilities of £2,673 million – a surplus of £36 million and a funding level of 101% on a technical provisions basis. This assesses the funding level of the Plan based on certain assumptions about the future and therefore does not mean the surplus is "spare money". Those figures exclude money in the DC Section and any AVCs paid by DB members.
The healthy funding of the DB Section of the Plan is one of the Trustee’s core priorities, and the Company remains committed to its long-term funding objectives.
We’ve recently released our first Climate Disclosure Report, which tells you what we’re doing to make sure we’re investing the Plan’s assets in environmentally sustainable ways. You might not realise, but your pension savings collectively have tremendous power for good – not only through direct investment in ‘green’ companies, but also through voting rights that our investment managers can exercise as stakeholders.
We’ve published our report in an online format, to help you get to the heart of the information it contains. Go to tcfd.pensioninfo.totalenergies.uk to read more.
On 6 March 2024, Chancellor Jeremy Hunt delivered his Spring Budget, setting out the Government’s key commitments and objectives for the UK economy.
While 2023’s Budget contained significant changes to pension taxation, there were no such announcements this year. Instead, the main takeaway for pension schemes was a push to deliver better value for savers and increase investment in the UK economy.
The Chancellor announced new powers for The Pensions Regulator and the Financial Conduct Authority to assess pension schemes on overall returns rather than just costs. There will also be new requirements for Defined Contribution and Local Government schemes to declare how much they have invested in UK shares.
The consultation on the idea of “pots for life” (pension accounts you can take with you when you move employer) will continue, as part of ongoing efforts to make pensions simpler and more flexible.
Many of the headlines picked up on the reduction of employee National Insurance contributions from 10% to 8% (on top of the reduction from 12% announced in the Autumn Statement). This cut represents a further attempt to ease the cost-of-living pressures many are still facing. It could also present an opportunity for people to put a little more aside for their future – perhaps by increasing contributions to their pension.
If you’d like to check how your TotalEnergies pension is doing, you can always visit the Member Portal.
As we come to the end of another tax year, you may find this a good time to do some financial planning. Figuring out how your TotalEnergies pension fits in with that bigger picture could be a helpful first step. If you want to check the current position of your pension, why not visit our member portal?
Budgeting and expenses
It’s important to regularly revisit your budget and align it with your financial goals. Analysing monthly expenses and identifying areas where adjustments can be made will help in maintaining a balanced budget and getting on top of any debt you may have. You should also consider potential increases in living costs, such as healthcare, utilities, and groceries.
Government programs and benefits
It’s important to keep up to date with new laws and Government initiatives. This includes staying informed about adjustments in pension taxation, tax credits, and potential help and/or benefits that you may be eligible for. If things aren’t clear, seeking advice from financial professionals or using online resources can help.
If you’re getting close to retirement and want to think about how much income you’ll need, you might find it helpful to look at the Retirement Living Standards produced by the Pensions and Lifetime Savings Association (PLSA): retirementlivingstandards.org.uk
The PLSA have recently published a new set of figures, increased to take account of the rises in the cost of living and greater expectations for grandparents to provide financial support to grandchildren. These figures suggest a single person will need an income of just over £31,000 in retirement to support a moderate standard of living, with a married couple needing £43,000.
The Retirement Living Standards website gives more information about how these figures have been calculated, along with suggested incomes required for a minimum or a more comfortable standard of living. They can be a really helpful guide for your financial planning, so we suggest you take a look. You can then go onto the Member Portal to use our retirement modeller and see how your savings in the Plan measure up.
New research from NOW: Pensions and the Pensions Policy Institute (PPI) shows that, when it comes to retirement provision, women are at a significant disadvantage. On average, women retire with £69,000 in their pension savings, compared to a figure of £205,000 for men. This difference amounts to an extra 19 years of saving at average rates. To put it another way, a girl would have to start saving for retirement at the age of three to catch up with a man who started saving at 22 when automatic enrolment for occupational pension schemes kicks in.
There are various reasons for this, including lower incomes for women generally. About 1.9 million women in the UK don't get automatically enrolled in a workplace pension because they earn less than the threshold. If the age and earning requirements were removed, nearly 885,000 more young women would join a workplace pension.
Women often take breaks from work for childcare or other caring responsibilities, which can lead to a significant gap in their careers and, on average, £39,000 less in pension savings. Childcare costs are also a burden, with average nursery fees being around £14,800 a year, rising to £20,000 or more in London. As a result of these factors, by their late 50s, women have typically only accumulated 62% of the pension wealth of men.
Making matters worse, women generally live longer than men, which means their pension savings have to last longer. Due to a lifetime of earning inequalities, two-thirds of pensioners living in poverty are women, with single women making up half of this group.
These findings are important because they help the pensions industry and female pension savers to be more aware of the size of the problem so we can start doing something about it. If you’re concerned about your own situation, the first step is to make sure you know how much your pension is worth and what you can do to give it a boost. A visit to the Member Portal should be your first port of call – why not log in today and see where your savings are up to?
To read general information about the Plan, go to our website, pensioninfo.totalenergies.uk
To access the Member Portal and view your specific information, go to the “View my pension online” section of the website.
And don’t forget our new pensions app, which you can also use to view your personal details. Go to your app store and search for “Orion+ Buck” to get started. Your registration details will be the same as for the Portal, so you’ll need to make sure you’ve registered there first.
You can get general help and advice about pensions from MoneyHelper, a free service from the Government.
If you’ve lost touch with a pension you had in the past, the Pension Tracing Service may be able to help.
Gallagher is the Plan Administrator for the TotalEnergies UK Pension Plan.
If you have any questions about your benefits, you can contact them by: