2021 UTC (UK) Pension Scheme Member Newsletter

2021 UTC (UK) Pension Scheme Member Newsletter

UTC (UK) PENSION SCHEME

NEWSLETTER | AUGUST 2021

WHAT’S INSIDE? 03 UTC Scheme update 05 Your options at retirement 07 Money matters 08 Investment overview 10 Summary Funding Statement 12 What are your Retirement Living Standards? 13 What you need to know about the State Pension 14 Pensions tax allowances update

15 And don’t forget... 17 Further Information 18 Jargon buster 19 Your pensions team 20 Who to contact

Welcome

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Welcome ❝

...to your latest newsletter for the UTC (UK) Pension Scheme (“the Scheme”). The Trustee issues this newsletter each year to provide you with the latest news about the Scheme, and pensions in general.

We have a few things to update you on in relation to the Scheme on pages 3 and 4. This includes an update on the impact of UTC’s demerger and subsequent merger with Raytheon Company to form Raytheon Technologies Corporation; some reassurance over your pension benefits in relation to the effects of COVID-19 and Brexit on the investment markets; an update on how we are ensuring the Scheme complies with sex discrimination laws; an update on environmental, social and corporate governance requirements in relation to Scheme investments; and comfort in relation to the government announcement relating to future inflation. If you haven’t yet started taking your pension benefits, you may find the article on page 5 helpful, reminding you of your options at retirement. If you are still a while away from retirement, you may still find some of the information provided of interest, as it also covers the process for transferring your benefits out of the Scheme and a reminder about pension scams and where to find more information. On page 7 the regular ‘Money matters’ section provides a summary of the Report & Accounts showing how much money came into and went out of the Scheme during 2019 and information about the Scheme’s membership and advisers. The ‘Investment overview’ section on pages 8 and 9 includes information on the investment approach and performance of the Scheme and you can find the ‘Summary Funding Statement’ on page 10, which gives you an update on the Scheme’s financial strength, including its ability to pay members’ benefits as promised.

We’ve also included some useful information about the Pensions and Lifetime Savings Association’s Retirement Living Standards, designed to help people plan for the retirement they want on page 12; the State Pension, including how to claim, the age you can start receiving it and how to find out how much you will receive, on page 13; and an update on the pension tax allowances for the 2021/22 tax year on page 14. And finally, near the back of this newsletter, we’ve included the regular content reminding you to update your Expression of Wishes information and making sure your contact details are up to date, plus an additional section on what to do in the event of a member’s death. As always we hope you find this newsletter interesting and informative. We welcome feedback, so if you have any suggestions for what you’d like to see included in the next

newsletter, or just want to give us your feedback, please get in touch. See the back page for our contact details.

❞

Greg Smart, Chairman of the Trustee, UTC (UK) Pension Scheme

UTC Scheme update

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UTC Scheme update

COVID-19 and Brexit 2020 was certainly a year that none of us expected and, no doubt, one that we’ll never forget. With COVID-19, and Brexit now that the UK officially left the EU on 31 December 2020, resulting in a phenomenal change to the way we work, and live our lives, the economy hasn’t been left unscathed. As a result, investment markets have been reacting strongly to these events and their impact on businesses around the world. While the speed of change in investments right now is certainly unusual, please be assured that this does not impact your pension benefits. The Scheme pays a benefit based on salary and years of active membership. This means that, while the investments may rise and fall, your benefits will be unaffected and continue to be paid. As additional assurance, you should know that we invest the Scheme funds in a way that gives some protection against the worst extremes. Recently this has included steps to reduce the risks of the current investment strategy further by agreeing a de-risking strategy with the Principal Employer. This strategy allows us to move assets into lower risk funds when certain funding triggers are met, which will ensure further protection for member benefits. We (alongside our investment managers) are continuously monitoring the situation and are ready to react, if necessary, to ensure that the Scheme remains well funded.

Separation of UTC and UTC’s merger with Raytheon On 3 April 2020 UTC separated into three separate entities; UTC Aerospace, Otis and Carrier and on the same day, UTC merged with Raytheon Company to form Raytheon Technologies Corporation (RTX). Following the separation of UTC, the non-aerospace businesses that previously participated in the Scheme ceased to do so. We can, however, assure you that no member benefits have been adversely affected by this activity. Leading up to the separation of UTC, we, alongside our advisers, worked very closely with UTC and its advisers to ensure the Scheme could continue to meet the benefits built up by its members, including those members who are, or have been, employed by Otis, Carrier or UTC Aerospace. We are pleased to report that following these discussions, we now have in place a formal guarantee from UTC (now RTX) that it will continue to meet present and future obligations and liabilities, subject to the terms of the guarantee.

UTC Scheme update

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UTC Scheme update continued...

Future inflation The government and UK Statistics Authority (UKSA) confirmed in November 2020 that, following their joint consultation, they will bring the methods and >Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20

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