BBA Income & Protection Plan - Defined Contribution Section. A guide to making the most of it

(1)

BBA Income &

Protection Plan -

Defined Contribution

Section

(2)

Some important information

Not everyone feels comfortable making financial decisions, so we recommend you seek independent financial advice if you’re unsure about the choices you should make. There may be a cost for this advice, which will be for you to pay.

Before you decide to join, you need to know what the risks and commitments are. Read our Key Features Document (TBP17). It will help you decide if this product is right for you. If you’re still not sure what to do, speak to your independent financial adviser. Laws and tax rules may change in the future. The information here is based on our pensions experts’ understanding of the current situation.

This booklet is issued by Standard Life. It does not confer rights to benefits. Rights to benefits Contents

01 Welcome to the BBA Income & Protection Plan - Defined Contribution Section (‘the Plan’)

Step 1

02 Pensions explained

05 Why should I consider a pension? 06 How much should I put in?

Step 2

10 The basics of investing

11 Asset classes: how funds are invested

Step 3

14 The investment choices available to you 16 The Lifestyle option: how does it work? 21 The self-select funds you can choose from

Step 4

29 Next steps

(3)

Welcome to the BBA Income &

Protection Plan - Defined

Contribution Section

The decisions you make about your pension today could make a big difference to your life in retirement. The Plan will help you save for retirement and this guide will help explain how it works.

We always try to write material that’s easy to read and jargon free, but we also have to ensure that our information is as concise as possible so that customers have an accurate record of the risks involved. If you need any assistance with this guide, you’ll find a glossary in the document library on your pension website

www.standardlifepensions.com/ bbaaviation to use as an

easy reference.

Your company pension

in four simple steps

We’ve split this guide into four key steps:

1. Understand how the Plan works – including the benefits of being a member.

3. Discover your investment choices – including details about the Lifestyle options and self-select options. 4. Find out what to do next and

where to go for help.

What do I need to do?

You need to make an important decision about whether you want to join the Plan and start saving for your future.

If you’re already saving for your retirement, you need to decide whether the benefits of the new Plan make it the right choice for you.

Once you’ve made the decision, step four, which you’ll find on page 29 of this guide, will take you through what you need to do next.

The role of the Trustees

The Trustees are responsible for:

¬Running the Plan in line with current law and the trust deed and rules.

(4)

Step 1

Pensions explained

What is a pension?

A pension is like a savings account you can’t touch, designed to give you an income when you retire. The Plan is what’s known as a defined contribution plan. Contributions, made by both you and BBA Aviation, go into your own personal pension account and you choose where to invest that money from a range of investment funds. The amount you receive when you retire will depend on:

¬How much you and your employer contribute to your pension.

¬The investments you choose, how they perform and any fees and charges on the funds.

¬How much it costs to buy a retirement income when you come to retire.

BBA Aviation can collect employee contributions through a process called Salary Exchange, (see pages 03 and 04 for more information). You need to opt in to do this, by ticking the appropriate box on your joining form. You’ll find the form in the document library on your pension website

www.standardlifepensons.com/ bbaaviation

The value of your investments... will rise and fall in line with investment return, and charges

will be deducted.

Which gives you…

your pension pot, from which you choose how to take your retirement benefits (see page 06

for your income options).

Contributions are paid... into the Plan by your employer. This includes your contribution (made by Salary Exchange, if you

opt in to this process).

Contributions are used… to buy units in the investment

funds you have chosen to invest in.

(5)

It’s important to regularly

review your pension to make

sure you stay on track.

How does Salary

Exchange work?

Salary Exchange involves restructuring the way you make pension payments.

It works like this:

¬You agree to exchange part of your pensionable income to invest in the Plan.

¬You don’t pay National

Insurance (NI) or income tax on the amount you’ve exchanged.

¬The amount that you’ve exchanged, plus your employer’s contribution, is paid into the Plan.

However, Salary Exchange isn’t right for some people. It’s a permanent change to your terms of employment and could affect your state or company benefits. Salary Exchange could also affect your ability to borrow, although BBA Aviation can provide details of the arrangement to potential lenders, and confirm your income before the Salary Exchange reduction. If you’re not sure whether Salary Exchange is right for you, you should speak to your employer, or you could ask an independent financial adviser for guidance. If you decide not to opt in to Salary Exchange, you can make your pension contributions directly from your salary. You’ll receive income tax relief on contributions, but you won’t see any NI saving.

(6)

With salary exchange Without salary exchange

Pensionable

Earnings £23,750(£25,000 salary – £1,250 pension contribution at source) £25,000 Deductions Tax NI Pension Contribution £3,255 £1,983 £0

(Pension contribution already deducted by employer at source)

£3,255

(Tax is calculated after the pension contribution is deducted)

£2,133 £1,250 Net take-home

pay £18,512 £18,362

Here’s an example to show how it works for you in practice.

Let’s assume your pensionable earnings are £25,000 and you want to contribute 5% to your pension. The table below illustrates how this works with, and without, Salary Exchange.

Remember this is an example. How it works for you will depend on

your individual circumstances. It’s important to remember that tax relief may change over time or with changes in legislation. You can be assured though, that the information here is based on our pension experts’ understanding of the current situation.

What’s in it for you?

¬Same gross pension contribution. ¬You pay less NI.

¬Increased take-home pay. Note: These figures

are for illustration only. All figures are based on annual tax allowances, NIC threshold limits and a single person’s tax allowance for the tax year 2011/12. These may be affected by future changes in tax, National Insurance Contributions, and legislation or by an individual’s particular circumstances.

(7)

Why should I consider

a pension?

For some, retirement is ‘two-star room-only’. For others it’s ‘five-star all-inclusive’. Most of us would prefer the latter, but a rewarding retirement has a price. Do you know if you’re putting enough away for it?

Planning ahead with your pension will help.

We’re not promising an easy route to luxury and riches. But we can help you get more from the Plan.

Hopefully, the decisions you make now will give you the lifestyle that you want when you come to retire.

We recommend you talk to an independent financial adviser before you make any investment decisions. If you don’t have an adviser you can find one near you by visiting www.unbiased.co.uk. Please note there may be costs associated with seeking advice, which will be for you to pay.

Myth Reality

I don’t need a pension – I’ll just work a few more years to make up the difference.

This might not be enough. People are living longer and our lives are generally healthier. If you don’t join a pension, you might have to work a lot longer than you thought. You might need to support yourself for 30 years or more in retirement.

The State Pension will look after me when I retire.

The maximum Basic State Pension for the tax year 2011/12 is £102.15 a week for a single person or £163.35 a week for a couple. Even with Pension Credit this only guarantees an income of £137.35 a week for a single person, or £209.70 a week for a couple. You may also have the State Second Pension provision or an income from another pension but you’d be surprised how many people are not saving enough.

I’m too busy to think about a pension. I have more important things to think about.

Everyone’s busy. And things like mortgages, loans and credit cards can seem more important. But saving for your retirement as soon as you can could make a huge difference to your lifestyle in later life.

(8)

How much should

I put in?

How much is enough?

Some advisers think you need between half and two thirds of your basic salary to live on in retirement.

Our online planning tools can help you see how much you could get in retirement. If your outcome is not what you hoped for, you can also see what happens if you put more in to your pension or retire at a different age. Go to

www.standardlife.co.uk/pensions

How contributions work

From you

You contribute a percentage of your pensionable earnings to be paid into the Plan. You need to make the minimum contributions as set out by your employer, but you can choose to contribute more.

From your employer

BBA Aviation will also contribute to your Plan. For details of the employer contribution level that applies to you, contact your HR Department.

Keeping track of

your pension

It’s up to you to regularly review your Plan to make sure you’re on track for your retirement. Each year we’ll send you a statement showing how your pension is doing. This might also be a good time to use the retirement planning tools on our website.

Income options

When you decide to stop working, you can use your pension

pot to purchase an income in retirement.

At present, your main options would be:

An annuity

This gives you an income for the rest of your life. This will be taxed as if it was earned income.

A tax-free lump sum

As well as an annuity, you can normally take up to 25% of your pension pot in cash, tax-free. This will mean the money remaining in your pension pot will provide a smaller income.

(9)

An income for a dependant after your death

You can choose a smaller income if you want to provide an income for your husband, wife, civil partner or other dependant(s) when you die.

Are there other options

when I retire?

You can transfer to another arrangement to get other income options. Additional terms, conditions and charges may apply. For example, you may be able to transfer to a Self Invested Personal Pension (SIPP). This plan offers the additional flexibility to take your retirement income by using something called income drawdown. It’s a way of taking some income from your pension savings as and when you need it, whilst keeping the rest of your pension pot invested. You can still usually take up to 25% of your pension as a lump sum with this option.

The Trustees, with

recommendations from their advisers, have created two investment options which target income drawdown. For more information about these options, see pages 18 and 20.

It is recommended that you seek independent financial advice before you consider transferring into a SIPP.

Please be aware of the risks to the value of your investments. The value can go down as well as up, and you might get back less than you paid in.

What if I leave

my employer?

If you leave, you can still keep your existing pension and the discounted charges will remain in place, although your employer would, of course, cease making contributions on your behalf. Your employer can tell you more about this too.

(10)

Why should I join the Plan?

¬Aim for a better lifestyle in retirement. ¬It’s flexible.

¬Manage your Plan online. ¬Tax relief benefits.

What if I die before

I retire?

The Trustees would give the value of your pension pot to your beneficiaries.

The Plan value will generally be paid in a lump sum, however the Trustess can use some, or all, or the money invested in the Plan to secure pension benefits for certain beneficiaries.

This might be taxable if it’s over the Lifetime Allowance set by HM Revenue & Customs. The Lifetime Allowance is the value of retirement benefits that you can draw from approved pension schemes before tax penalties apply. The current value is £1.8m; however this will change to £1.5m, from 6 April 2012.

Tell the Trustees about your family and dependants

To make sure your dependants benefit from your Plan, make sure you fill in the Nomination of Death Benefits form, which you’ll find on your pension website

www.standardlifepensions.com/ bbaaviation and return this to

your HR Department.

What you decide is important so consider this very carefully and ensure that, if your circumstances change, you keep your Nomination of Death Benefits form up to date. If in doubt, seek financial advice before making any decisions.

(11)

“ More time with family and

friends would be nice. But having

the time to take more regular

holidays and possibly do some

travelling would be great.”

(12)

Step 2

The basics of investing

You can choose where your

pension is invested from the range of options shown in this guide. All investments involve some risk – they can go down in value as well as up. So it’s important to understand the basics and find an option that you feel comfortable with.

Your opportunity

for growth

The money you put into the Plan is invested into funds. The price of units in investment-linked funds depends on the value of the underlying assets after charges. Assets move up or down in value depending on a number of things like the economy and market

confidence. Different funds carry different levels of risk. A fund with a higher level of risk means you’ll have the potential of a higher return – but also means your money is at more risk and you might not get back what you invested. So it’s important to get the right balance between risk and potential return.

Volatility

The volatility rating of an investment-linked fund indicates how much the fund price might move compared to other funds. The higher the volatility rating, the less stable the fund price is likely to be. You can use this to help you decide how much risk you’re comfortable taking with your investments.

How we rate the funds

We set ratings based on our experts’ judgement, using data on:

¬How the fund price has varied from month to month in the past, compared to other funds available.

¬How investments in similar asset classes vary from month to month and the investment policy of the fund.

We regularly review volatility ratings for funds, and these may change.

Volatility ratings for funds

Less

(13)

Asset classes:

how funds are invested

Assets and how your

pension fund is invested

An ‘asset class’ is a category of assets or investments, such as equities or bonds. Normally assets in the same class have similar characteristics. They can, however, have very different returns or risks.

The value of the investments in all asset classes can go up or down in value so you might get back less than you’ve paid in – there are no guarantees. Past performance is not a reliable guide to future performance. The asset mix that an

investment-linked fund invests in is continuously reviewed. It may be changed in line with developments in the relevant markets. Part of each fund may be held in cash and other money market instruments. Read this section for more information.

Equities

What are they?

Equities are part ownership in a company, usually known as stocks or shares.

What’s the potential return?

Equities can offer good long-term returns. The return you get is any change in value of the stocks and shares, plus any income from dividends. Changes in exchange rates will also affect equities that are listed in a foreign currency.

What are the risks?

Equities are one of the more volatile asset classes. So, although equities can offer good growth potential, their value can rise or drop sharply at any time.

(14)

Property

What is it?

Property investing includes direct investments in buildings and land, as well as indirect investment in property securities, like shares in property companies.

The return received from property is a combination of income from rent and any changes in the capital value of the property. In comparison, the return received from property securities can be similar to equities (see ‘equities’ asset class description for potential returns and risks).

The value of a property is generally based on a valuer’s opinion and is not fact. Property can take a lot longer to sell than other types of investment, so you might not be able to sell when you want to. Property securities, like equities, can rise or fall sharply in value at any time.

The values of different types of property do not necessarily move in line with each other. For example even if house prices are going up, commercial property could be losing value.

Bonds

What are they?

Bonds are, in simple terms, loans to a government or a company, usually for a set length of time. Bonds issued by the UK

government are called ‘gilts’ and those issued by a company are called ‘corporate bonds’.

The return is a combination of any interest received and any change in the bond’s value. For overseas bonds, changes in the foreign currency exchange rates may also affect returns (sometimes significantly).

The value of the bond may fall if:

¬The interest or capital can’t be paid back in full or on time

¬The credit worthiness of the company or government reduces

¬Interest rates or foreign currency exchange rates change

Bonds can be traded on the stock market, so their value can go up and down at any time.

(15)

Money Market Instruments

(including Cash)

What are they?

Bank and building society deposits as well as other instruments such as ‘Certificates of Deposit’ and ‘Floating Rate Notes’.

The return comes from a combination of any interest received as well as any change in the value of the instrument.

It is important to recognise that not all of the assets are the same as cash deposit accounts – there are circumstances where their values will fall. Also, any growth may not keep up with future rates of inflation.

Specialist

These are investments that don’t fit into the main asset class categories. They could be investments held directly, or indirectly, in real assets like commodities, for example oil or precious metals. They may also be investments like hedge funds, or have specialist characteristics that prevent them being

classified in one of the other main asset class categories. Standard Life categorises our fund range using ‘asset classes’. Sometimes we categorise funds as ‘specialist’ purely because they don’t meet the criteria of the recognised industry sectors, or they haven’t provided enough information to be categorised appropriately.

(16)

Step 3

The investment choices

available to you

Over the next few pages you’ll find information about the funds which the Trustees, with recommendations from their advisers, have selected for you to choose from. Please read your fund information carefully.

Lifestyle, or self-select?

Through the Plan you can:

¬Choose an automated Lifestyle option that evolves with you over your lifetime – see pages 16 to 20.

¬Self-select your investments from our range of 13 funds – see pages 24 to 28.

I want to join but don’t want to make an investment choice

If you don’t make a choice, contributions will automatically be invested in the BBA Income & Protection Plan - Balanced Annuity Lifestyle Profile (see page 17 for details). Please note this fund might not meet all your requirements.

I want to join and make an investment choice

Please see pages 17 to 28 for details on the options available.

Your options

If you are in any doubt about which fund(s) you should choose, you can get advice by speaking to an independent financial adviser. The adviser may charge you for this advice, and this is for you to pay.

Charges for your funds

There are two types of charges that can apply to funds you choose to invest in: the Fund Management Charge and Additional Expenses.

We regularly review our charges and sometimes we need to increase them to reflect changes in our overall costs, or assumptions. Any increases will be fair and reasonable.

Fund Management Charge (FMC)

A charge is applied to money invested in a fund. This charge is known as the Fund Management Charge. We deduct the charge from the fund on a daily basis which has the effect of reducing the unit price for the fund.

(17)

We’ve agreed with the Trustees, and their adviser, to provide enhanced terms to give you a rebate on some of your Fund Management Charge. Your rebate is given to you as additional units in your fund each month. This reduces the effect of the Fund Management Charge. In the long term your effective FMC will be close to the Fund Management Charge you pay less the rebate you receive. But it won’t be the same because the Fund Management Charge is deducted daily while the rebate is applied monthly.

Your effective FMC will be affected by factors such as:

¬The period it has been measured over.

¬Any single payments and transfer payments made.

¬Changes in the timing of your regular payments.

¬Daily changes in the fund value.

The enhanced terms agreed for

The example below illustrates how the effective FMC is calculated for a fund with an FMC of 1.00%:

FMC 1.00%

Less rebate 0.60%

Effective FMC 0.40%

Additional Expenses

Additional expenses may be deducted from some investment-linked funds. They include items such as trustees’, registrars’, auditors’, regulators’ fees and where a fund invests in other underlying funds they may include their underlying management charges. The additional expenses relate to expenses incurred during the fund management process and as such they will regularly increase and decrease as a percentage of the fund, sometimes significantly. Where expenses arise within a fund they have been taken into account in the calculation of the price.

All additional expense figures are rounded to two decimal places.

(18)

The Lifestyle option:

how does it work?

Lifestyle profiles are designed

for customers investing for retirement. The funds used depend on the profile chosen. The funds you are invested in at any point will also depend on how long you’ve got until your selected retirement date. If this date is some time away (typically more than 10 years), the profiles will invest in funds that offer growth potential over the long term. But remember that all funds can go up and down in value and investment growth is not guaranteed.

As you get closer to retirement, the investment aims of the profile move away from growth and towards preparing your pension pot for retirement. The profiles will do this by automatically switching your funds – you don’t need to do anything.

It’s important to remember that there are situations where these profiles may not be suitable. For example, if you’re not planning on retiring at your selected retirement age, or your retirement plans don’t match what the lifestyle profiles are targeting.

Your Lifestyle option choices

The Trustees, with

recommendations from their advisers, have created a range of four lifestyle profiles from which you can select. There are two investment strategies with different risk characteristics, and two retirement income options for each. If you are considering a Lifestyle profile, you should think about which investment strategy best meets your attitude to risk, and how you plan to take your retirement income.

Balanced strategy

This offers more potential for growth than the Cautious strategy and carries a moderate amount of risk.

Cautious strategy

This offers some potential for growth. The growth can be less than that achieved by the Balanced strategy, but it is also likely to be less risky.

(19)

BBA Income & Protection Plan Balanced Annuity Lifestyle Profile % of in ve st ments 100 90 80 70 60 50 40 30 20 10 0 Standard Life MyFolio Market IV Pension Fund Standard Life Managed Cash Pension Fund Standard Life Fixed Interest Pension Fund SL BlackRock Aquila HP Over 5 Year Index-Linked Gilt Pension Fund SL BlackRock Aquila HP Over 15 Year Gilt Pension Fund >10 9 8 7 6 5 4 3 2 1 3 Years Months Years to retirement

BBA Income & Protection Plan – Balanced Annuity

If you don’t make an investment choice, your funds will be invested in this Balanced Annuity Lifestyle Profile.

The profile follows a balanced investment strategy, and is designed for those looking to purchase an annuity at retirement.

For more information about the different options available to you on retirement, see page 06.

(20)

BBA Income & Protection Plan – Balanced Drawdown

If the balanced investment strategy is right for you, but you’re not looking to purchase an annuity when you retire, this profile may be a suitable investment choice.

This profile stays invested in growth funds for longer. You should remember however, that a fund with the potential of a higher return may also tend towards a higher level of risk.

BBA Income & Protection Plan Balanced Drawdown Lifestyle Profile

% of in ve st ments 100 90 80 70 60 50 40 30 20 10 0 Standard Life MyFolio Market IV Pension Fund Standard Life Managed Cash Pension Fund Standard Life Fixed Interest Pension Fund SL BlackRock Aquila HP Over 5 Year Index-Linked Gilt Pension Fund SL BlackRock Aquila HP Over 15 Year Gilt Pension Fund >10 9 8 7 6 5 4 3 2 1 3 Years Months Years from retirement

For more information about the different options available to you on retirement, see page 06. For more information about the funds that make up the Lifestyle Profile, see pages 24 to 28. This option is available to members of the BBA Income & Protection Plan – Defined Contribution Section. The profile is, however, designed to target income drawdown.

Income drawdown can only be selected once you’ve transferred to a SIPP. It is

(21)

BBA Income & Protection Plan - Cautious Annuity

This profile follows a cautious investment strategy, and is designed for those looking to purchase an annuity at retirement.

BBA Income & Protection Plan Cautious Annuity Lifestyle Profile

% of in ve st ments 100 90 80 70 60 50 40 30 20 10 0 Standard Life MyFolio Market II Pension Fund Standard Life Managed Cash Pension Fund Standard Life Fixed Interest Pension Fund SL BlackRock Aquila HP Over 5 Year Index-Linked Gilt Pension Fund SL BlackRock Aquila HP Over 15 Year Gilt Pension Fund >10 9 8 7 6 5 4 3 2 1 3 Years Months Years from retirement

For more information about the different options available to you on retirement, see page 06. For more information about the funds that make up the Lifestyle Profile, see pages 24 to 28.

(22)

BBA Income & Protection Plan – Cautious Drawdown

If the cautious investment strategy is right for you, but you’re not looking to purchase an annuity when you retire, this profile may be a suitable investment choice.

This profile stays invested in growth funds for longer. You should remember however, that a fund with the potential of a higher return may also tend towards a higher level of risk.

BBA Income & Protection Plan Cautious Drawdown Lifestyle Profile

% of in ve st ments 100 90 80 70 60 50 40 30 20 10 0 Standard Life MyFolio Market II Pension Fund Standard Life Managed Cash Pension Fund Standard Life Fixed Interest Pension Fund SL BlackRock Aquila HP Over 5 Year Index-Linked Gilt Pension Fund SL BlackRock Aquila HP Over 15 Year Gilt Pension Fund >10 9 8 7 6 5 4 3 2 1 3 Years Months Years from retirement

For more information about the different options available to you on retirement, see page 06. For more information about the funds that make up the Lifestyle Profile, see pages 24 to 28. This option is available to members of the BBA Income & Protection Plan – Defined Contribution Section. The profile is, however, designed to target income drawdown.

Income drawdown can only be selected once you’ve transferred to a SIPP. It is

(23)

The self-select funds

you can choose from

What you need to know

This selection of funds has been chosen by the Trustees, based on advice from their investment advisers. These are not recommendations; they are simply a range for you to choose from.

These funds invest in a mix of different assets such as money market instruments (including cash), bonds, property and equities (see pages 11 to 13). The funds can invest in one or more of these assets.

Some funds invest in overseas assets. This means that exchange rates and the political and economic situation in other countries can significantly affect the value of these funds. You might get back less than you paid in.

You’ll probably be one of many investors in each fund you choose. Sometimes, in exceptional circumstances, we may have to wait before we can transfer or switch your funds. This is to maintain fairness between those remaining in and those leaving the fund. This delay could be for up to a month. But for some funds, the delay could be longer:

¬It may be for up to 6 months if it’s a property based fund because property and land can take longer to sell.

¬If our fund invests in an external fund, the delay could be longer if the rules of the fund allow this.

¬If we have to delay a transfer or switch, we’ll use the fund prices on the day the transaction takes place – these prices could be very different from the prices on the day you made the request.

(24)

Property can take longer to sell than other types of investment – so you may not be able to sell your investment when you want to. In exceptional circumstances, it may take up to six months. The valuation of property is generally a matter of a valuer’s opinion rather than fact.

Some of the funds detailed on pages 24 to 28 invest in funds managed by external fund managers. In these cases, the description of the fund is provided by the external fund manager so Standard Life can’t guarantee that it’s accurate. External fund managers are in charge of managing their own funds including what they invest in. This means that Standard Life is not responsible for these funds’ performance or continued availability.

The investment performance of the Standard Life version of a fund will be different from what you would see if you invested in the underlying fund directly. There can be several differences, due to charges, cash management, tax and the timing of investing.

Some of our funds invest in other funds that are managed by external fund managers. Those external funds could be withdrawn at any time, and this is outside our control. We are not responsible for the investment performance of these funds. Also, the external fund manager could suspend dealings in their fund or delay withdrawals from it. Some fund managers will look to get a better return by lending some of the assets from their fund to certain financial institutions. This involves some risk and could result in a loss. The fund manager may apply controls to manage this risk. For example, they may monitor the borrower’s credit rating or ask them to provide security.

Funds can sometimes use derivatives to improve portfolio management and to help meet investment objectives. A derivative is a financial instrument – its value is derived from the underlying value or movement in other assets, financial commodities or instruments, like equities, bonds, interest rates etc.

(25)

There is a risk that a counterparty will fail, or partially fail, to meet their contractual obligations under the arrangement. Where a counterparty fails, the fund could suffer a loss. As part of the management of a fund, a number of controls can be used to reduce the impact of this risk, such as holding collateral and monitoring credit ratings.

Depending on how it is used, a derivative can involve little financial outlay but result in large gains or losses. Standard Life has control over the use of derivatives in its funds and external fund managers are responsible for their own controls.

Remember, you should always keep an eye on any fund’s performance, especially as you get closer to retirement. Some of the fund descriptions might use words or phrases you’re not familiar with. You’ll find a glossary in the document library on your pension website

www.standardlifepensions.com/ bbaaviation to use as an

easy reference, or you can speak to your independent financial adviser if you need an explanation.

(26)

Fund information

Fund name Fund description Volatility

rating Effective FMC Additional expenses Fund code

Standard Life Ethical Pension Fund

The fund aims to provide long term growth by investing in a diversified portfolio of assets (including equities and corporate bonds) that meet our strict ethical criteria. The fund’s assets can be from both the UK and overseas and are predominantly equity based. The ethical criteria are agreed with the Standard Life Ethical Committee and may be amended from time to time if considered appropriate. The fund manager will exclude companies which fail to meet the ethical criteria whilst seeking to include companies whose business activities are regarded as making a positive contribution to society.

5 0.40% 0.00% G7

Standard Life Managed Cash Pension Fund

The fund aims to provide a return before charges equivalent to overnight deposits by investing in deposits and short term money market instruments.

The fund price is not guaranteed by Standard Life and there could be circumstances where the fund price may fall. A fall might happen if, for example, there is a default by one of the banks where some of the money is held or where there is an adverse market movement in the value of some of the money market instruments held. A fall may also happen if interest income falls so low as to be less than the charges applied to the fund.

1 0.40% 0.00% G4 SL Baillie Gifford Worldwide Equity Pension Fund

The SL Baillie Gifford Worldwide Equity Pension Fund invests primarily in the Baillie Gifford 50:50 Worldwide Equity Pension Fund. The aim of the Baillie Gifford 50:50 Worldwide Equity Pension Fund is summarised below.

To invest in UK and international equities through the Baillie Gifford UK Pension Fund and Baillie Gifford Overseas Equity Pension Fund with the aim of achieving capital growth.

(27)

Fund information (Continued)

SL BlackRock Aquila HP (50:50) Global Equity Pension Fund

The SL BlackRock Aquila HP (50:50) Global Equity Pension Fund invests primarily in the BlackRock Aquila HP 50/50 Global Equity Pension Fund. The aim of the BlackRock Aquila HP 50/50 Global Equity Pension Fund is summarised below. To invest primarily in equities, both in the UK and overseas markets. The fund has approximately 50% invested in the shares of UK companies. The remaining 50% is invested in overseas companies split equally between the US, Europe ex-UK and the Far East. The fund aims to provide returns consistent with the markets in which it invests and provides broad exposure to countries around the world.

6 0.40% 0.01% JO

SL HSBC Amanah Pension Fund

The SL HSBC Amanah Pension Fund invests primarily in the HSBC Amanah Global Equity Index Fund. The aim of the HSBC Amanah Global Equity Index Fund is summarised below.

To achieve capital appreciation over the long-term principally through the implementation of an active management strategy. The investments will consist of a diversified portfolio of global equities adhering to Shariah principles.

6 0.70% 0.00% JB SL Schroder Intermediated Diversified Growth Pension Fund

The SL Schroder Intermediated Diversified Growth Pension Fund invests primarily in the Schroder Intermediated Diversified Growth Fund. The aim of the Schroder Intermediated

Diversified Growth Fund is summarised below. To generate a return of RPI +5% per annum over a five to seven year period. The Life Intermediated Diversified Growth Fund supports goals where there is a desire to grow assets to a similar extent to equities, but with reduced volatility. The Fund can invest in a broad array of asset classes, equities, bonds and a range of diversifiers. The Fund may also invest in a wide range of

(28)

Fund information (Continued)

SL SLI Global Absolute Return Strategies Pension Fund

The fund is invested in the Standard Life Investments Global Absolute Return Strategies Fund which aims to provide positive investment returns in all market conditions over the medium to long term. The investment team who actively manage the fund have a wide investment remit to help them try to achieve this aim. The team look to exploit market inefficiencies through active allocation to highly diversified market positions. The fund manager utilises a combination of traditional assets (such as equities and bonds) and investment strategies based on advanced derivative techniques resulting in a highly diversified portfolio. The fund can take long and short positions in markets, securities and groups of securities through derivative contracts.

3 0.90% 0.11% YX

Standard Life Fixed Interest Pension Fund

The fund aims to provide long term growth mainly from the reinvestment of income generated by investing predominantly in UK bonds such as gilts and corporate bonds. The fund is actively managed by our investment teams who may also invest a proportion of assets in other bonds (e.g. overseas bonds) and/or money market

instruments such as Certificates of Deposits (CDs) and Floating Rate Notes (FRNs), to try to take advantage of opportunities they have identified.

2 0.40% 0.00% FP SL BlackRock Aquila HP Over 15 Year Gilt Pension Fund

The SL BlackRock Aquila HP Over 15 Years Gilt Pension Fund invests primarily in the BlackRock Aquila HP 15 Year Gilt Pension Fund. The aim of the BlackRock Aquila HP 15 Year Gilt Pension Fund is summarised below.

To invest in UK government fixed income securities (gilts) that have a maturity period of 15 years or longer. The fund aims to achieve a return consistent with the FTSE UK Gilts Over 15 Years Index, which is widely regarded as the benchmark for UK pension fund investment in the longer dated end of the UK gilt market.

(29)

Fund information (Continued)

Standard Life Property Pension Fund

The fund aims to provide long term growth from a combination of income and capital growth by investing predominantly in prime quality UK properties. Typically the fund will invest in a mix of freehold and leasehold properties selected from across the retail, office and industrial sectors. The fund may also invest in European properties and in property development opportunities. As well as direct investments, the fund may also invest indirectly in property through investment vehicles such as quoted and unquoted property companies or collective investment schemes. Selling property can be a lengthy process so investors in the fund should be aware that they may not be able to sell their investment when they want to.

3 0.40% 0.00% FM SL BlackRock Aquila HP Over 5 Year Index Linked Gilt Pension Fund

The SL BlackRock Aquila HP Over 5 Year Index Linked Gilt Pension Fund invests primarily in the BlackRock Aquila HP Over 5 Year Index Linked Gilt Pension Fund. The aim of the BlackRock Aquila HP Over 5 Year Index Linked Gilt Pension Fund is summarised below. To invest in UK government index-linked securities (index-linked gilts) that have a maturity period of 5 years or longer. The fund aims to achieve a return consistent with the FTSE UK Gilts Index-Linked Over 5 Years Index, which is widely regarded as the benchmark for UK pension fund investment in the longer dated end of the UK index-linked gilt market.

3 0.40% 0.01% NB

Standard Life MyFolio Market II Pension Fund

The fund is invested in the Standard Life Investments MyFolio Market II Fund which aims to provide a total return from a combination of income and capital appreciation over the longer term. Investing mainly in a range of collective investment schemes to achieve a broad exposure to diversified investments, including equities, fixed and variable rate interest bearing securities and immoveable property. Exposure to equities and fixed and variable interest

(30)

For more information

about effective FMC and

Additional expenses, see

pages 14 and 15.

Fund information (Continued)

Standard Life MyFolio Market IV Pension Fund

The fund is invested in the Standard Life Investments MyFolio Market IV Fund which aims to provide a total return from a combination of income and capital appreciation over the longer term. Investing mainly in a range of collective investment schemes to achieve a broad exposure to diversified investments, including equities, fixed and variable rate interest bearing securities and immoveable property. Exposure to equities and fixed and variable interest bearing securities is achieved by investing mainly in passively managed collective investment schemes. Exposure to immoveable property is achieved by investing mainly in actively managed collective investment schemes. The fund may also invest in transferable securities, money-market instruments, deposits and cash. Typically, the fund will have a preference to those assets providing potential for growth, such as equities.

5 0.20% 0.36% LLNB

The funds listed here were correct when this document was published. We can’t guarantee that all funds will be available when you make an investment.

(31)

Step 4

Next steps and other

useful information

I’m ready to join, so what happens next?

The helpline

You can contact Standard Life

01

Make sure you’ve read all the joining information, including your Key Features Document.

02

Decide how much you want to contribute, and whether you want to opt in to Salary Exchange. Remember, you need to contribute at least the minimum amount set out by your employer to receive their contributions. For details of the employer contribution levels, contact your HR Department.

03

Choose your investment options. An independent financial adviser can help you with this if you’re not sure what to do.

04

Complete the Joining form and return it to your HR Department. If you’ve received a joining pack, you’ll find a copy of the form there, or you can download it from the document library on your pension website www.standardlifepensions.com/bbaaviation

You’ll find everything you need either in your pack, or in

(32)

Can I keep track of

my Plan online?

With a Standard Life pension, you get to see all your information online. Go to the BBA Aviation pension website

www.standardlifepensions.com/ bbaaviation to check on your

pension, your investment funds, and to make any changes. Here’s what you can do online:

¬See what your pension is worth at today’s date and what it may be worth in the future.

¬Check your contributions.

¬Check and change your investments.

¬Learn more about pensions with useful tutorials and calculators.

¬Update your personal details.

¬Get more information or download your documents.

Can I transfer other

pensions into this one?

You may be able to transfer in your pensions from other companies or pension providers, though the minimum amount you can transfer is £1,000.

It is recommended that you seek financial advice before you consider transferring.

One last thing to remember…

If you look after your pension now

it can look after you in later life.

(34)

Other sources of help

and information

Resolving issues

If you have a pension problem or enquiry in relation to your pension please speak to Standard Life first. If we can’t resolve it, or if you are not satisfied you can use the dispute resolution procedure. Details will be sent to you if you make a complaint. If you’d like more information on this please speak to your employer.

Internal Dispute

Resolution Procedure

Stage 1

If you have a disagreement with the Trustees, you can ask for a written decision. Your employer has forms which you can use for this purpose. If you use one of these forms, this will help the Trustees reply quickly to your request. You will normally receive a reply within two months. If this is not possible, the Trustees will send you a letter explaining the reason for the delay and a target date for a full reply.

Stage 2

If you do not agree with the decision, you have six months to ask the Trustees to reconsider. You should make your request in writing and send it to the same address. The Trustees will normally reply within two months. If this is not possible, the Trustees will send you a letter explaining the reason for the delay and a target date for a full reply.

A person who could become a member under the Rules and a widow, widower, surviving civil partner or another surviving dependant of a deceased member can also use the procedure. A more detailed explanation of the dispute procedure is also available from your employer.

(35)

The Pensions Advisory

Service (TPAS)

TPAS is available at any time to help you or your beneficiaries in connection with:

¬any pensions query ¬any difficulty which has

not been resolved with the Trustees.

You can contact TPAS at 11 Belgrave Road, London SW1V 1RB.

The Pensions Regulator

The Pensions Regulator replaced the Occupational Pensions Regulatory Authority (OPRA) in April 2005. The Regulator’s main aims are to protect the benefits of scheme members and to promote good scheme administration. The Regulator also has wide ranging powers such as the right to freeze scheme assets and to suspend or remove Trustees. You can contact the Regulator at Napier House, Trafalgar Place, Brighton,

Pensions Ombudsman

The Pensions Ombudsman appointed under section 145(2) of the Pensions Schemes Act 1993 may investigate and determine any complaint or dispute of fact or law in relation to an occupational pension scheme (including this Plan) made or referred to in accordance with that Act. He may be contacted at the Office of the Pensions Ombudsman, 11 Belgrave Road, London SW1V 1RB.

You should normally use the internal dispute procedure before you contact the Pensions Ombudsman.

Registrar of Occupational

and Personal

Pension Schemes

Where required, information about the Plan (including information about the address where the Trustees may be contacted) has been given to the Registrar of Occupational and Personal Pension Schemes,

(36)

Pensions

Savings Investments Insurance

Standard Life Assurance Limited is registered in Scotland (SC286833) at Standard Life House,30 Lothian Road, Edinburgh EH1 2DH. Standard Life Assurance Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. www.standardlife.co.uk

Find out more

If you’d like more information on the products or services within this literature, or if there’s anything more we can help you with, just call us on this number or visit our website.

Call us on 0845 278 5677

(Mon-Fri, 9am to 5pm). Call charges may vary and calls may be recorded and/or monitored to help improve customer service.

www.standardlifepensions.com/

bbaaviation

Products provided by subsidiaries of Standard Life plc or other specified providers.