1. Pantheon Financial Management Ltd Making a Success of Pensions Reform Chris Rose and Mark Dowde May 2012

2. Pantheon Financial Management Ltd www.pantheonfinancial.co.uk Independent Financial Advisers www.pantheonfinancial.co.uk Corporate Services  Business Strategies; Business Protection  Employee Benefits Group Communications  Share Schemes; Redundancy Programmes  Retirement Counselling Private Client Services  Retirement Planning; Investment Planning  Tax & Trust Planning

3. Pantheon Financial Management Ltd www.pantheonfinancial.co.uk Independent Financial Advisers www.pantheonfinancial.co.uk The material provided by this presentation is for general information only and does not constitute investment, tax, legal of other forms of financial advice.

4. OVERVIEW Why reform workplace pensions? Changes to workplace pensions The National Employment Savings Trust (NEST)

5. NEST (NATIONAL EMPLOYMENT SAVINGS TRUST) (NATIONAL EMPLOYMENT SAVINGS TRUST) 10-11m people will be auto enrolled 10-11m people will be auto enrolled In 1901 there were 10 workers for every pensioner, now there are 4 workers for every pensioner and by 2050 this is expected to be 2 workers for every pensioner In 1901 there were 10 workers for every pensioner, now there are 4 workers for every pensioner and by 2050 this is expected to be 2 workers for every pensioner (Source: DWP Report May 2011)

6. Why Reform Workplace Pensions?

7. The Pension Commission 2003-2005 Pension Commission reviewed the UK pensions system and made recommendations Pension Commission found that: -Up to 12 million people were not saving enough for retirement -Longevity – simply put, people are living longer in retirement.

8. The Pension Commission - Longevity

9. The Pension Commission State Pension could not meet this challenge Spending on State Benefits for pensioners - 2006/2007 - £84.6 billion - 2035/2036 - £189.1 billion* Taking no action would lead to an unaffordable burden on taxpayers *Projected –source: Pensions Policy Institute Key Facts / Scottish Life April 2012

10. The Pension Commission Recommendations Fairer, more generous State Pension coverage (flat rate £140 / week (no set date currently in place)) System of automatic enrolment into pension saving Minimum employer contribution to workers’ pensions New, national pension scheme designed to provide a simple and low cost way of saving for low-to-moderate earners

11. Changes to Workplace Pensions

12. Who Does What? DEPARTMENT FOR WORK & PENSIONS (DWP) Scope of automatic enrolment Staging and phasing timetable THE PENSIONS REGULATOR Monitor and regulate the employer duties. NEST (NATIONAL EMPLOYMENT SAVINGS TRUST) NEST (NATIONAL EMPLOYMENT SAVINGS TRUST) A new, trust-based pension scheme for low to moderate earners Public service obligation to accept all employers

13. 2012 Reforms: What’s Changing? Employers have to offer a contribution to certain employees No action will result in a qualifying employee automatically saving through a workplace pension. This is as a result of Automatic enrolment Objective: Saving is the norm 2012-2016

14. Impact on Employers (Pensions Act 2008 and 2010 Review ) Automatic enrolment of “eligible jobholders” From age 22 up to State Pension Age Those earning more than the tax threshold “staged” in from Oct 2012, depending on employee numbers 3 month waiting period, plus flexibility to bring forward Re-enrolment required every 3 years, new post review flexibility Individuals can choose to opt out but employer cannot

15. Impact on Employers (Pensions Act 2008 and 2010 Review ) Minimum Employer Contributions – Employers have to pay in at least part of a minimum contribution with individuals and HMRC contributing the rest Contributions based on earnings band £5,564 and £42,475 in 2012/13 tax year (Based on Draft Regulation source: Contributions based on earnings band £5,564 and £42,475 in 2012/13 tax year (Based on Draft Regulation source: - : “The Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2012” 3% of “band earnings” minimum employer contribution + tax relief + employee contribution = total 8% minimum contribution Total minimum contribution payable from October 2018 Example – earnings £30,000 – E’er £62.41 & E’ee £104.02 gross per month (source: The Pension Regulator May 2012)

16. Minimum contribution levels The total minimum contribution to a employees retirement pot will be 8% of the qualifying earnings Of this 8%, the employer will have to contribute a minimum of 3% The rest will be made up of tax relief and the employee’s contribution

17. DWP: Planned Stages Large Employers Medium Employers Small / Micro Employers New PAYEs Staging dates 01/10/2012 through to 01/02/2018 (Source: Pension Regulator Website May 2012)

18. The Administrator of NEST Tata Consultancy Services IT services, business solutions and outsourcing International – 137 offices in 42 countries – 88 delivery centres in 18 countries 160,000 employees globally More than 60 sites in the UK Tata and Diligenta (UK Operation) – experienced partners Diligenta is a UK based, FSA regulated subsidiary of Tata Consultancy Services – the world’s leading IT consulting, services and business outsourcing (BPO) organisations. Diligenta manage and support Life & Pensions operations 3 rd Party Administrators – More than 30 years experience in UK insurance sector with 90 insurance clients including the top 7 UK insurers (including AXA Group, Phoenix Group, L&G, Skandia)

19. NEST Investment Options NEST Retirement Fund NEST Higher Risk Fund NEST Pre-retirement Fund NEST Ethical Fund NEST Sharia Fund NEST Lower Growth Fund NEST Corporate Bond Fund

20. Charges – How will NEST compare? NEST - 1.8% Contribution Charge; 0.3% Annual Management Charge (AMC) Contribution charge deducted until set cost met. Gross contribution of £100 will result in £98.20 investment. Calculated by NEST to average out at a 0.5% AMC but dependent on term to retirement. Combination of Contribution Charge and AMC.

21. 2012 – Employer Options Choices for employees Existing DB and DC schemes New DC automatic enrolment schemes Existing/New Existing DB and DC schemes NEST + Sole schemeAssociate, entry level or base scheme

22. How NEST can be used Sole scheme Offered to all employees Associate scheme For a category of employee to sit alongside existing scheme e.g. the low paid Entry level scheme Where your existing scheme has a waiting period Base scheme To which minimum contributions are made for all employees, with another scheme on top

23. Any Questions?

24. This information is based on our understanding of current taxation law and Her Majesty’s Revenue and Customs practice, which may change in the future. Price of units can fall as well as rise. Past performance is not a guide on which to base future returns. Pantheon Financial Ltd group of companies incorporating Pantheon Financial Management Ltd and Pantheon Financial Investments Ltd. Henton & Co. Financial Services is a trading style of Pantheon Financial Management Ltd. Pantheon Financial Ltd has no connection with Pantheon Ventures Ltd or its affiliated companies or with any funds managed or advised by Pantheon Ventures Ltd or its affiliated companies, including Pantheon Participations PLC. enquiries@pantheonfinancial.co.uk www.pantheonfinancial.co.uk Chelmsford: Aquila House, Waterloo Lane, Chelmsford, Essex CM1 1BN Tel: 01245 254200Fax:01245 254254 Gloucester: 1414 Charlton Court, Gloucester Business Park, GloucesterTel: 01452 651110Fax: 01452 651126 GL3 4AE Hartley Wintney: Kenward House, High Street, Hartley Wintney,Tel: 01252 847000Fax: 01252 847001 Hampshire RG27 8NY Leeds (Head Office): Springfield House, 76 Wellington Street, Leeds LS1 2AYTel: 0113 200 6200Fax: 0113 200 6201 London: 59 Shelton Street, London WC2H 9HETel: 020 7212 9922Fax: 020 7212 9920 Orpington: Central Court, Knoll Rise, Orpington, Kent BR6 0JATel: 01689 899456Fax: 01689 899457 Scunthorpe: Woodfield House, Doncaster Road, Scunthorpe DN15 7DQTel: 01724 849481Fax: 01724 849842