Mouchel Business Services has completed a £9.5 million transaction for the money purchase section of its pension scheme.
The Mouchel money purchase section was a defined contribution (DC) arrangement with a defined benefit (DB) underpin. As a result, the scheme would top up members’ benefits if their DC pot value was not high enough when they reached retirement.
The scheme is sponsored by Kier Group. Aon and Just Group carried out the transaction to secure all 220 members’ benefits, supported by the Smart Pension Master Trust.
The underpin could not be secured in its existing state, so a change in members’ benefits was needed. They were consulted and received access to educational material and independent financial advice.
The transaction also included a pre-planned accelerated move to full administration. Just and Smart Pension’s partnership enabled different parts of members’ benefits to be managed in a linked service.
Jas Bhogal, pensions manager at Kier Group, said: “This was a complex piece of work, with several workstreams. The technical expertise provided by all of the consultants in our working group was invaluable in completing this project on time and in achieving good outcomes for the members of the scheme.”
Russell Powles, associate partner and head of Aon’s underpin team, added: “The project involved a complex underpin scheme that required a collaborative solution with Just, and which was led by Aon’s specialist underpin team, combining expertise in member options and risk settlement.
“Members were provided with paid-for independent financial advice which, prior to the transaction, helped them to consider their options and to choose the shape of benefits that would best suit their needs. The project also required a significant level of legal advice, provided by Hogan Lovells. This was concise and delivered on time, which was important for ensuring the project progressed as desired.”
Geraint Jones, senior business development manager at Just, said: “By working closely with Aon’s specialist underpin team, we were able to support an innovative solution that unlocked the potential for members’ benefits to be insured and provides long-term certainty.”
