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HAYS PENSION SCHEME

PAGES 4-5

PAGES 6-8

PAGES 11-13

PAGE 14

The Annual Newsletter for the Hays Pension Scheme

PENSION NEWS

THE FINANCIALS

SUMMARY FUNDING STATEMENT

EMAIL COMMUNICATIONS

UPDATE

Keeping you up to date with how your Scheme is performing

2016

03 | Hays Pension Scheme Update 2016Hays Pension Scheme Update 2016

CONTENTS

02 |

Page 3Chairman’s welcome

Pages 4 - 5Pension news and meet your Trustee Board

Pages 6 - 8The financials

Pages 9 - 10The investments

Pages 11 - 13Summary Funding Statement

Page 14New ways of communicating with you

Page 15Keeping in touch and contact details

Back pageEmail communicationsopt-in form

Welcome to the 2016 edition of Update – the newsletter about pensions for members of the Hays Pension Scheme (the Scheme).

CHAIRMAN’SWELCOME

From next year you’ll be able to receive your copy of Update by email – see page 14.

Head to page 14 to find out more about receiving future communications by email, then please complete the tear-off form on the back page and return it to the Hays Pension Team.

Trustee Board changes

Philip Gillett retired as Chairman of the Trustee Board in April 2016 after four years. I would like to thank Philip for his hard work and the experience that he brought to the Scheme.

As your new Chairman, I’m looking forward to the challenges ahead and I hope to bring my previous experience and knowledge to the Trustee Board. Through my role at Law Debenture I am involved with a number of pension schemes of varying sizes and chair some of them. I have had a previous executive career with BT where I was a Trustee of its pension scheme.

Valuation results

It has been a busy year for the Scheme. In addition to the Trustee Board changes, we had our triennial actuarial valuation as at 30 June 2015 and you can find out the results on pages 11 to 13.

New ways of communicating with you

We are pleased to announce that from next year you’ll be able to receive your copy of Update by email.

We are also hoping to send out future communications by email so that you can view them on the go, access them at any time, and easily find the information most relevant to you.

We will of course continue to issue printed copies to those members who do not wish to receive Update or future communications via email.

We are always looking for new suggestions for our pension communications, so please get in touch with any feedback or ideas you may have.

Andrew Parker Chairman

Hays Pension Scheme Update 201604 | 05 |Hays Pension Scheme Update 2016 Hays Pension Scheme Update 2016

On 23 June 2016, the UK voted to leave the European Union, resulting in volatile financial markets. The Trustee would like to assure members that your pension is safe and will continue to be paid as normal. The Trustee will continue to ensure that the Scheme is run in the best interests of its members.

Last year, Hays plc (the Company) decided to offer deferred members aged 55 and over the opportunity to transfer their benefits out of the Scheme. That exercise is now complete and we are pleased to report that it has successfully given many members flexibility with regard to their retirement options.

Although current pension scams are still common, we would like to assure you that your Hays pension is safe.

The Trustee would, however, urge you to be conscious of online safety and make sure that any passwords you may use are not likely to be easily discovered by potential hackers.

PENSION NEWS

MEET YOUR TRUSTEE BOARDThe Scheme is looked after by a Trustee company that has a Board of Trustee Directors. The Trustee is legally responsible for managing the assets of the Scheme and ensuring that members receive their correct benefits.

The members of the Trustee Board are:

Brexit Pension scams

Flexible retirement exercise update

Age UK:Provides a range of services, information and support on various subjects, including State benefits, grants and security.

Phone: 0800 169 6565

Visit: www.ageuk.org.uk

The Pensions Advisory Service: Provides information and advice on pensions (but does not deal with individual pension queries).

Phone: 0300 123 1047

Visit: www.pensionsadvisoryservice.org.uk

The Pension Tracing Service: Helps you to find any pension schemes you have lost touch with.

Phone: 0345 600 2537

Visit: www.gov.uk/find-pension-contact-details

TOP - Tax Help for Older People: Offers independent advice from qualified tax advisers for people in later life who have a low income.

Phone: 0845 601 3321

Visit: www.taxvol.org.uk

Winter Fuel Payment Helpline: Government-run information service providing information about the Winter Fuel Payment, guidance on reporting changes to your circumstances and a claim form.

Phone: 03459 15 15 15

Visit: www.gov.uk/winter-fuel-payment

Useful contacts in retirement

Secretary to the Trustee and Pensions Manager: Kath Bedford

Company-nominated Directors:

Ian Pratt

Robert Potter (resigned 22 March 2016)

Doug Evans (appointed 22 March 2016)

Member-nominated Directors:

Paul Dungate

Charles Logan

Andrew Timlin (resigned 16 June 2016)

Stuart Hill (appointed 16 June 2016)

Chairman and Independent Director:Andrew Parker

Independent Director and Chairman of the Investment Sub-Committee: Alan Saunders

Membership

Key points

As the Scheme closed to new entrants on 30 June 2012, deferred members will hold their benefits in the Scheme until they retire. The breakdown below shows how the deferred and pensioner membership has changed over the past year.

Deferred members

Investments returned £116.6m

Liabilities increased over the year

£81.1m increase in fund value

06 | Hays Pension Scheme Update 2016

In this section you can find out about the Scheme’s financial position, see a detailed breakdown of the Scheme’s income and expenditure and find updated membership figures. You will also find information about how the Scheme’s assets are invested and how these investments have performed during the last year.

What is an actuarial valuation?

A formal actuarial valuation is carried out by the Scheme Actuary every three years as required by law. The valuation compares the amount of money (known as assets) in the Scheme with the amount of money the Scheme best estimates it needs to pay members’ benefits in the future (known as liabilities). The resulting comparison details the funding position of the Scheme. It is very important to know if a scheme has sufficient money to pay all of the benefits due.

If the Scheme has more money than it needs, it has a surplus. If the Scheme does not have enough money, there is a deficit. If there is a deficit, the Trustee will agree with the Company the level of Company contributions needed to ensure the Scheme can meet all of its liabilities, and a Recovery Plan will be put in place to set out the amount and frequency of the contributions agreed.

The Trustee provides you with a Summary Funding Statement annually to update you on the most recent funding position. This year’s statement gives you details and results of the triennial actuarial valuation of the Scheme as at 30 June 2015 as well as the funding position of the Scheme at 30 June 2016.


THE FINANCIALS SUMMARY FUNDINGSTATEMENT

2,858

5,338

30 June 2016

30 June 2016

30 June 2015

30 June 2015 2,795

Pensioner members

5,005

You can obtain a copy of the full report and accounts by contacting the Pensions Manager (contact details are on page 15).

Expenditure (£000s) (£000s)

Pensions paid 13 ,571 13 ,350

Lump sums on retirement 2,398 1 ,901

Lump sums on death 16 1 15

Payments to and in respect of leavers 26,895 1 ,685

Other payments 14 23

Administration and investment expenses 5,378 5,200

Annuities purchased - 11

Total expenditure 48,272 22,285

08 |

Income (£000s) (£000s)

Company contributions 13,987 13,580

Member contributions - -

Other income 80 107

Investment income (1,250) 10,935

Total income 12,817 24,622

30 June 2015*30 June 2016

Hays Pension Scheme Update 2016

Income and expenditure

A breakdown of the Scheme’s income (money paid in) and expenditure (money paid out) is shown below.How the value of the Scheme has changed

THE FINANCIALS


The Scheme receives income through a combination of Company contributions and investment returns. As the Scheme is closed, there are no longer any member contributions, only agreed shortfall contributions by the Company paid in accordance with the Recovery Plan.

The summary below shows how the value of the Scheme’s assets has changed over the past year.

30 June 2015* (£000s)Value at beginning of year

Value at end of year

Income

£24,622

£22,285£52,708

£589,954£644,999

ExpenditureReturns from investments

+

+ - =

30 June 2016 (£000s)Value at beginning of year

Value at end of year

Income

£12,817

£48,272£116,604

£644,999£726,148

ExpenditureReturns from investments

+

+ - =

*2015 figures have been restated

*2015 figures have been restated


Asset allocation

The money in the Scheme is invested to ensure that the value of the Scheme’s assets keep up with the cost needed to pay members’ benefits when they become payable. The Trustee regularly reviews the Scheme’s investment managers and the allocation of the Scheme’s assets, with the day to day management of the assets being delegated to the investment managers.

The money in the Scheme, known as its assets, is invested in various asset classes in line with the Trustee’s investment strategy.

THE INVESTMENTS

Global Multi-Asset Credit 6.5

Corporate Bonds 26.3

Absolute Return Bonds 5.3

Gilts and Equivalent Bonds (LDI) 31.7

Property 6.4

Total bond assets 76.2

Total 100%

Allocation %

UK Equities 4.6

Overseas Equities 17.5

Absolute Return 5.2

Short Cash Exposure -3.5

Total growth assets 23.8

The allocation of assets at 30 June 2016:

Investment performance

10 |

To see how the Scheme’s investments are performing, they are measured against a benchmark. This is used to judge how well they are performing. The performance of the Scheme’s investments in comparison with their relative benchmarks is shown below.

1 year (%) 3 years (%) 5 years (%)Actual Actual Actual Benchmark Benchmark Benchmark

20.6 13.1 11.4 11.1


12.718.8

The Scheme’s investments underperformed against their benchmarks set by the Trustee over the past year, but have exceeded the benchmarks set over the five year period.

Note: these figures are annualised.

Finding out moreYou can find out more about the Scheme’s funding

or request the Scheme’s financial documents by contacting the Pensions Manager (contact details on page 15).

The Scheme’s funding position

When is the next valuation?

What else do I need to know?


The table below shows how the Scheme’s funding position at the 30 June 2015 valuation compared with the previous valuation carried out as at 30 June 2012.

A formal valuation of the Scheme is carried out every three years. The next valuation will be as at 30 June 2018.

The Trustee must inform you each year whether or not the Company has taken any money out of the Scheme and the Trustee is happy to confirm, once again, that the Company has not taken any money out of the Scheme in the last 12 months.

30 June 2015 30 June 2012

Funding level

77%

Funding level

87%

12 | 13 |Hays Pension Scheme Update 2016

£724m

Deficit

Deficit

Liabilities LiabilitiesAssets Assets

£629m £624m £479m

£145m

On a solvency basis

The Trustee is legally obliged to tell members what the Scheme’s Funding position would be if the Scheme was to wind up and members’ benefits were bought out by an insurance company. This does not mean that the Trustee is considering winding up the Scheme.

If the Scheme had wound up as at 30 June 2015, there would have been an estimated shortfall of £409 million. This means that there would have been enough money in the Scheme to secure 61% of members’ benefits.

If a scheme doesn’t have enough money to cover the cost of providing all members’ benefits with an insurer, benefits could be provided by the Pension Protection Fund (PPF).

The PPF was set up to pay compensation to members of eligible defined benefit pension schemes that do not have enough assets to cover the cost of paying the minimum level of benefits to members.

£95m

The ongoing funding position of the Scheme

What is the Company doing to reduce the deficit?

At 30 June 2015, the actuarial valuation showed that there was a deficit. To address this, there is a Recovery Plan in place. The Company agreed to pay contributions of £14 million a year towards the Scheme. These contributions will increase by 3% each July until May 2025 when the deficit is estimated to be paid off.

Between actuarial valuations, the Scheme Actuary prepares an annual updated estimate of the funding position. The most recent estimate of the funding position at 30 June 2016, compared with the valuation results as at 30 June 2015, estimated that the deficit had increased from £95 million to £146 million and the funding level had fallen to 83%.

?

The Pensions Regulator’s directions

We’re required by law to inform you that The Pensions Regulator has not used its legal powers to modify any future accruals in the Scheme, nor has it directed how the technical provisions are to be calculated or imposed a Schedule of Contributions on the Scheme.

15 | Hays Pension Scheme Update 2016 Hays Pension Scheme Update 2015

Sign up now

NEW WAYS OF COMMUNICATING WITH YOU


To begin moving online, we need to collect your email address so that we can email you with Scheme news. Please complete the tear-off form on the back page of this newsletter and return to the Hays Pension Team using the enclosed freepost envelope.

Please note, communications containing personal information will continue to be sent to you by post.We will of course continue to issue paper communications to those members who do not wish to receive Update or future communications via email.

This means you’ll be able to view it on the go, access it at any time, and easily find the information most relevant to you.

We believe communicating with you by email will keep you better informed with Scheme news, as well as other information like Trustee vacancies and pension matters that may be of importance to you. It will also help us to keep down costs for printing and postage.

From next year you’ll be able to receive your copy of Update by email.

14 |

If you have any queries about your pension, or if your personal details change, please contact the Scheme administrator:

Email: [email protected] Phone: 01293 604656

Hays Pension Administration Team Equiniti Pension Solutions Sutherland House Russell Way Crawley West Sussex RH10 1UH

For other enquiries, or if you would like to see a copy of the full Report and Accounts, please contact the Pensions Manager:

Email: [email protected] Phone: 020 7391 6641

Kath Bedford Pensions Manager Hays plc 250 Euston Road London NW1 2AF

Have you completed an Expression of Wish form?

It’s important to keep this updated so that in the event of your death we know who you would like to receive any lump sum death benefits.

If you’ve been receiving your pension for more than five years you don’t need to update your Expression of Wish form.

Please remember that if your details or circumstances change, for example if you change your address, you will need to let us know (even if you decide to provide us with your email address) so we’re able to keep you updated about your pension.

KEEPING IN TOUCH

CONTACT DETAILS


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