The trustee of the General Healthcare Group (GHG) Pension and Life Assurance plan has completed a £150 million insurance scheme buy in.
The deal, which the organisation secured with Aviva, covers all of its 700 defined benefit (DB) members.
In 2008, the trustee hired scheme secretariat firm Inside Pensions to provide a strong independent governance framework as well as appointing its MD, Rita Powell, as an independent trustee and chair of the trustee board.Investment firm Redington has also been appointed to work with the trustees and sponsor to establish a long-term risk management framework.
In the last ten years, this process has seen the scheme grow its asset value from £79 million to over £150 million, and secure a £27 million deficit with just £5 million of deficit repair contributions required from the sponsor over the ten year period.
Other Scheme advisors included Aon Actuary and Administrator, Pinsent Masons, Lawyers and LCP Buyin Advisors.
The deal faced financial pressures from its sponsor, BMI Healthcare, meaning it was crucial to put the right investment plan in place.
Rita Powell, founder at the Inside Pensions and Chair of Trustees of the GHG Pension Plan, said: “We knew we needed a radical change in approach to overcome our difficulties, but as a small scheme with the minimal resource we had to think differently to find the right solution. By focusing carefully on what really mattered and working closely with the sponsor and our investment and governance experts, the Trustee was able to come up with a long-term funding plan that worked for all parties.”
“With the current market downturn putting those with funding challenges under increasing pressure, this case shows that there is a workable solution for everyone,regardless of sponsor strength, scheme size and budget, given the right long term funding plan and a strong governance framework.”
