Summary Funding Statement as at 5 April 2019
As you are a member entitled to benefits from the Revlon Group Pension Plan (“the Plan”) we
are writing to provide you with an update of the financial position of the Plan. A further update
will be provided every year.
1 The Plan and the ongoing coronavirus pandemic
We understand you may be concerned about the effect that coronavirus, and recent falls in the
financial markets, may be having on your retirement savings. No one knows how the
coronavirus pandemic will develop. From the perspective of your retirement savings, whilst this
can be unsettling, there are a number of reasons to feel assured:
- The value of your pension, which is referred to as a “defined benefit” pension, is
based upon your length of service with Revlon rather than market performance and is
unaffected by the current situation.
- The Plan’s Administrators are continuing to administer the Plan, albeit remotely.
Contingency plans have been activated so that the Administrators can continue to
respond to your queries and carry out critical processes such as paying pensions and
processing retirements and bereavements.
- The Trustee of the Plan continues to hold its regular Trustee meetings via conference
call and continues to keep up to date with the latest guidance from the Pensions
- For members who hold Additional Voluntary Contributions (AVCs), the value of these
accounts are directly linked to the performance of your chosen investment fund.
Although the value of investments can go up or down, history shows that values
generally go up over the longer term, despite short term falls in financial markets.
2 Please be aware of pension scams
Since the coronavirus pandemic began, scammers may try to take advantage of people’s
vulnerability with potential victims possibly being more susceptible to fall for a scam because
they are worried, and their attention is elsewhere. The Trustee or the Plan’s Administrators will
not call you unexpectedly about your pension. If you’re unsure if a call is real, hang up and get
in touch with the Plan Administrators using the details at the end of this statement.
Tips to avoid falling victim to a scam
- Ignore any email about your pension that comes from an unknown sender
- Ignore any cold calls about your pension
- Ignore any unsolicited contact (by phone, mail, email etc) asking for financial and personal information
- Find out more about staying scam smart at www.fca.org.uk/scamsmart
3 How the Plan operates
Revlon International Corporation, UK Branch (“Revlon” or “the Company”) pays contributions to
the Plan so that it can pay pensions to members when they retire. These contributions are
invested in a common fund; separate funds are not held for each individual. (Previously, Plan
members also paid contributions to the Plan while they were employed by Revlon, but there are
currently no active members of the Plan.)
The Plan invests the contributions received in a variety of assets. The Plan’s current long-term
investment policy is to invest 50% of the Plan’s assets in a diversified growth fund, which
provides access to a wide range of asset classes, and the remaining 50% of the Plan’s assets
in bonds and gilts. The Trustee implemented this policy during 2019 to reduce the amount of
investment risk being taken by the Plan.
The assets and liabilities of the Plan are monitored and actuarial valuations – or financial “health
checks” – of the Plan are regularly obtained. This process involves a comparison of the value
of the investments held by the Plan with the amount estimated to be needed to pay the benefits
built up to date, determined using assumptions regarding future unknown events. Using this
information, the Trustee comes to an agreement with Revlon on the level of contributions to be
paid to the Plan in the future.
4 Actuarial valuation as at 5 April 2018
The last full actuarial valuation of the Plan was carried out as at 5 April 2018. It showed that on an ongoing basis the Plan’s assets covered 101% of the estimated value of its liabilities. The Plan’s assets represented a £0.6 million surplus relative to the estimated cost of the benefits at that time.
As a result of the valuation, Revlon and the Trustee have agreed to maintain the amount paid in respect of administration expenses at £17,700 a month. These contributions have been paid since 1 December 2015. There are currently no active members in the Plan, so there are no ongoing pay-related contributions payable.
5 Funding update as at 5 April 2019
The Trustee has now obtained an actuarial report detailing an approximate update of the Plan’s funding position as at 5 April 2019. This report showed that on a broadly consistent basis the Plan’s assets covered 99% of the estimated value of its liabilities as at 5 April 2019. This means that the Plan’s assets were £0.6 million less than the estimated cost of the benefits at that time.
The Plan’s funding level has decreased to 99% from 101% at the actuarial valuation at 5 April 2018. This small decrease results largely from a reduction in gilt yields and an increase in assumed inflation, resulting in a higher value being placed on the Plan’s liabilities.
6 Pension Protection Fund and solvency estimate
If the Plan were to wind up in the future, you might not get the full amount of pension you have built up even if the Plan were fully funded on an ongoing basis at that time. However, whilst the Plan remains ongoing, even while there remains a shortfall, benefits will continue to be paid in full.
For example, had the Plan been wound up on 5 April 2018, then the additional assets required to meet all members’ benefits in full were estimated to be around £11.4 million – on this basis the Plan was around 80% funded. This calculation assumes that all benefits would be bought out with an insurance company, and insurance companies are obliged to take a very cautious view of the future. Because the cost of buy-out is so high, most pension plans such as ours do not aim initially to achieve a 100% funding level on a buy-out (or winding up) basis.
If the Plan were to wind up, Revlon would be required to pay enough into the Plan to enable members’ benefits to be completely secured with an insurance company. There always exists the possibility, however, that a sponsor of a pension plan (like Revlon) would not be able to pay the full amount to completely fund members’ benefits. If Revlon were to become insolvent, the Pension Protection Fund might be able to take over the Plan and pay compensation to members, although this compensation is likely to be somewhat less than the benefits provided for under the Plan Rules. (For further information on the Pension Protection Fund see their website at www.ppf.co.uk or email them at email@example.com.)
Note that we are required by law to provide this information on winding up solvency – it does not imply that there is any intention by Revlon or the Trustee to wind up the Plan.
7 Involvement of the Pensions Regulator (“the Regulator”)
The Plan Rules have not been modified by the Regulator, the Plan is not subject to any directions from the Regulator, and the Plan is not bound by a Schedule of Contributions imposed by the Regulator.
8 Payments to the employer
No payments have been made in the year from 6 April 2018 from the Plan’s assets to Revlon.
9 Future “health checks”
The Trustee continues to monitor the Plan’s funding position and is in the process of obtaining another actuarial report as at 5 April 2020 detailing an approximate update of the funding position of the Plan at that date. A funding statement describing the results of that update will be issued in due course. The next formal valuation of the Plan will be carried out as at 5 April 2021.
10 Looking after your data
Some personal data for Plan members (such as date of birth and address) is required for the running of the Plan, including paying out the right benefits. The use of this data is regulated under the European Union General Data Protection Regulation 2016/679 (“the GDPR”), which places certain responsibilities on those who exercise control over the data (known as “data controllers” under the GDPR). Data controllers would include the Trustee of the Plan, and, in certain circumstances, professional advisers to the Plan.
The Plan’s actuarial advisors, Willis Towers Watson, have provided details on their responsibilities on their website: www.willistowerswatson.com/personal-data. Likewise, the Plan’s legal advisers, Eversheds Sutherland, have published their Privacy Notice on their website: www.eversheds-sutherland.com/global/en/who/contact-us/data-protection-and-privacystatement.page.
The Trustee of the Plan takes their responsibilities under the GDPR very seriously and takes all possible steps to make sure that your personally identifiable information remains secure. More information about the personal information the Plan holds about you, how this information is used and what your rights are in relation to your data, was included in the Privacy Notice that was sent to you in 2018.
If you have any questions, or would like more information, please contact the Plan’s Administrators:
St James’s Tower
7 Charlotte Street
Tel: 0161 931 4514
A list of some of the more detailed documents available to you is attached. If you would like to receive any of these documents, please contact the Plan’s Administrators.
We are able to provide you with information, but if for any reason you are considering changing your pension arrangements, or leaving the Plan, you should seek independent financial advice before taking any action. The website www.unbiased.co.uk contains a list of independent financial advisers.
Please help us to keep in touch with you by telling the Plan’s Administrators if you change your address. Please also contact the Administrators if you would like to amend your expression of wish form at any time.
Revlon Pension Trustee Company (UK) Limited
Some additional documents available on request
The Statement of Investment Principles: explains how the Trustee invests the money paid into the Plan.
The Schedule of Contributions: sets out how much money is being paid into the Plan, and when.
The Annual Report and Accounts: shows the Plan’s income and expenditure for the year to 5 April 2019.
The Actuarial Valuation report: sets out the results of the actuarial valuation as at 5 April 2018 in more detail. It also includes the following documents that were agreed between Revlon and the Trustee:
The member booklet: you will have been given a copy of this on joining the Plan.
- Statement of Funding Principles
- Schedule of Contributions