Mainline Utilities Group Pension Scheme
ESTABLISHMENT OF THE PLAN
The Company is pleased to announce that the Mainline Utilities Group Pension Scheme took effect from the 1st of August 2002. This information is intended as a guide to answer some of the questions, which you may have. A copy of an Explanatory Booklet is available for all employees who join the Scheme. The Scheme has been established as a Defined Contribution Scheme within the meaning of the Pensions Act 1990. Members save tax on their contributions and also have the option to pay Additional Voluntary Contributions and avail of extra substantial tax relief and PRSI relief automatically at source.
WHO IS ELIGIBLE TO JOIN?
All employees over age 18 who are on either the direct weekly or monthly payrolls will be offered membership of the scheme. Membership of the scheme is optional however employees may be required to sign a waiver form if they do not wish to join the Scheme at the first available opportunity. Contributions for non- salaried employees will be based on the current “Average Industrial Wage” as declared by CSO.
HOW MUCH ARE YOU REQUIRED TO PAY?
You will be required to contribute at the rate of 4 % of Basic Salary and Mainline will also pay 4% of Basic Salary. Basic Salary excludes overtime, all bonus payments, and any Benefit in Kind remuneration. In the case of workers on piece work rate (i.e. WTMs ) as there is no “basic Salary”, contributions will be based on the agreed annual industrial wage. Your contribution will qualify for full tax relief against PAYE at your marginal rate of tax. PRSI relief will also be available. An example of the tax reliefs, which is given through the payroll, is set out below;-
Example based on a gross basic level weekly contribution of €50 (i.e. €25 from you plus Mainline’s contribution of €25):
- Gross Pension Contribution
- Less Employer Contribution
- Less PRSI @6% & tax relief
- Net Cost to You:
- A – 40% Rate Tax Payer
- B – 20% Rate Tax Payer
COMPANY CONTRIBUTION LEVELS
The Company will contribute at the rate of 4% of your basic annual salary. In the case of WTMs, this will be an amount equivalent to 4% of the agreed average industrial wage increasing in line with CPI.
The employer’s contribution includes the costs associated with the administration of the scheme and includes the policy fees and Pensions Board levy.
MEMBER’S PENSION AT NORMAL PENSION DATE (ASSUMED AGE 60)
Both Member and Company contributions will accumulate with investment returns to provide a fund at normal pension date, which will be used to secure a Tax-Free Lump sum and/or pension for you and your spouse (if you are married at the time of retirement). The amount of Tax-Free Lump sum and pension, which will be provided, depends upon the amount of the Accumulated Fund and interest rates prevailing at the time of retirement.
You may if you wish, make Additional Voluntary Contributions in order to secure Additional Benefits. The maximum level of contributions, which you may pay are dependent on your age are set out below less your 4% ordinary member contribution.
(Attained During Tax Year)
- Up to 30 years of age
- 30 up to 39 years of age
- 40 up to 49 years of age
- 50 up to 54 years of age
- 55 up to 59 years of age
- 60 & Over
- Personal Contribution limit
(As a % of Schedule E Earnings)
Advice will be provided to you on request in order to maximise the benefits of making AVCs
The Trustees have opted for a “Consensus” approach to investment, which offers members the benefit of the collective wisdom of fund managers, thereby eliminating the risk of underperformance from a single manager. The other main investment funds relate to property and equity funds which will be listed in the Explanatory Booklet (please call 01 – 8797100 for details)
Fund Risk Profile
Members will have their contributions invested in the Exempt Consensus Fund unless otherwise instructed. The Contributions to the scheme will be invested at 105% less a bid/offer spread of 5%. Investment Returns will be net of an annual fund management charge of 0.90% for the Consensus Fund.
If you leave the service of Mainline Mainline before the end of the two year vesting period you will be entitled to a Refund of your Contributions to the Scheme less tax calculated at the standard rate prevailing at the time ( currently 20%). If you leave service after this period you will be entitled to the value of your own contributions and the Company contributions paid on your behalf. You may decide to leave the value of the contributions in the Fund or transfer the value to a new approved Scheme or to a personal retirement bond.
HOW TO JOIN THE SCHEME:
Complete an application form and return it to HR Mainline Mainline Membership of the Scheme will be open to all existing eligible employees. New Employees who join the Company will be invited to join the scheme after completing 6 months service.