Dear Colleagues

Welcome to the second issue of Talking Pensions, the Kingfisher pensions newsletter for all employees.As pensions assume an increasingly high profile in politics, the media and indeed, become something of a talking point at work, I hope you will find the newsletter both interesting and useful.

For the first time this year, all employees will receive a personal benefit statement. For those of you already building up a Kingfisher pension, the statement includes information about your pension to date and as well as what you might expect to receive at retirement. For those colleagues who have previously decided not to join the scheme, we want to be sure you are happy it was the right decision. As such, we’ve provided a forecast of the pension you might receive if you were to join the pension scheme. Also for the first time, I’m pleased to say that your benefit statement will include an indication of the pension you might expect to receive from the State; giving you a much better idea of what income you will have in retirement.

Also look out for highlights of the annual Trustees’ Report and accounts for 2004-05. Should you need further information about the Scheme, you can obtain a copy of the full Trustee’s Report and Accounts either from the Kingfisher Group Pensions Department at the address here or from the pensions website www.kgbd.co.uk.

The year to March 2005, like last year, was one of enormous change and challenge for the pensions department.The most obvious change was the launch of the new money purchase section of the Scheme which on its very first day had attracted over 5,000 members. Creating the new scheme and all the administrative processes to ensure it is managed effectively required a monumental effort by my team, and I would like to publicly thank each of them for their hard work in ensuring the successful launch of the new arrangement, as well as maintaining the usual high standard of customer service for the final salary section.

There has also been significant work undertaken on the Scheme’s communication material, and if you are a member of either section of the Scheme, you should have received a new pension scheme booklet earlier in the year. If you haven’t, then please let your normal HR contact know.
At the beginning of the Scheme year, the Trustees undertook a formal funding valuation of the Scheme, following the closure of the final salary section to new members, and the transfer out of the Comet membership. Part of the valuation process has been to reach agreement with the Group on the level of contributions to be paid for the next three years.

I am pleased to report that the Group has significantly increased its contributions to the Scheme, and indeed, over the next three years, the Group will be contributing some £370 million into the Scheme. You can read more about this good news here.

In addition to the valuation, the Trustees are also undertaking a review of the Scheme’s investment strategy.Whilst this is a lengthy process and still has significant work to be done, major progress has been made already and further details can be found on here.

Turning to the wider perspective, the Trustees have welcomed the recent legislation aimed at providing greater security for members’ pensions and simplifying the taxation regime surrounding pension schemes. The pensions team are in the process of identifying the impact for our Scheme to ensure that appropriate measures are in place to ensure compliance with these wide-ranging pieces of legislation.A summary of the more important aspects is provided here, and later in the year, we will write to all Scheme members individually to explain how the legislation will affect them.

Best wishes

Colin Hately
Head of Pensions