International oil and gas exploration and production company BG Group is to launch a new defined benefit scheme for its 1300 UK-based employees.
The £250m BG Pension Scheme will launch the DB scheme next month. The move follows the demerger of Lattice Group, the gas pipeline company, last October.
Trustees of the new pension scheme have already completed its investment manager selection. This will comprise two active managers, one passive manager and one global custodian.
The new scheme has an active membership of 1300 employees with a handful of pensioners and deferred pensioners.
BG Group head of pensions Janet Rice said: “The new scheme will launch on July 4 and we hope to make a big impression with the employees who have given their consent to transfer from Lattice to the BG scheme.”
BG Group was originally British Gas. In 1997 it demerged Centrica with the company splitting itself into two FTSE-quoted companies. British Gas renamed itself BG Group while Centrica took the British Gas label in UK.In October 2000, BG Group demerged Transco - the gas pipeline business in the UK - which renamed itself the Lattice Group. The company has the larger number of employees - 15,000 compared with BG’s 4000. It became the sponsoring employer and acquired the £13bn defined scheme.
Rice said: “We have remained a participating employer in the Lattice Group scheme and had up to 12 months to establish our own pension scheme which had to fulfil certain conditions. It will be a fairly aggressive portfolio and is very much scheme specific which is what Myners is after. Because we are a relatively young scheme our focus will be on global equities.”
The employees’ contribution rate is fixed at 3%. Employer rates have not been decided but is thought to be between a minimum contribution level of 3% to a maximum of 20%.
Watson Wyatt will provide actuarial and consultancy advice, administration will be outsourced to Eastlands Benefits Administration and the legal adviser will be Rowe and Maw.
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