EC Meeting July 2017

As a general rule, it is undesirable to make any trustee an ex officio appointment. Someone may be the best candidate for the office of General Secretary or Chair, but might not have the time or inclination to be a trustee as well. He or she might not be permitted to be a trustee: without suggesting that it might ever be the case in the GFTU, people who have certain unspent convictions, or who are undischarged bankrupts, or who have been disqualified to be a company director or trustee, cannot be pension scheme trustees. A trust deed which says that they must be is therefore unhelpful.

I set out the options for change below.

Member-nominated trustees

As mentioned above, the current trustees believe that the active members should be preferred in the process that they design for the selection of member-nominated trustees. Deferred pensioners have less interest in the pension scheme of a former employer. Pensioners have an acute interest, but different priorities: they have no concern about future benefit terms or contribution rates, and less of an interest in the financial strain that the Scheme places on the employers. For that reason, the trustees’ current process provides for the appointment of one GFTU Section active member (who is, by definition, the General Secretary) and one PCS Section active member. The trustees have decided that the selection of the PCS Section active member trustee should be decided upon by the PCS Section active membership, and there is no reason to think that that causes any difficulties. The selection of the third member-nominated trustee is proving to be more difficult. This seat is currently reserved for a pensioner member. It cannot be filled by a GFTU Section active member because the only one is already a trustee. If it were filled by a PCS Section active member, there would be more PCS Section member-nominated trustees than GFTU Section member-nominated trustees, despite the fact that there are significantly more GFTU Section members as a whole. This post is currently filled by a former GFTU employee pensioner, but his term of office has come to an end. The trustees ran two abortive ballots to fill the post. In the light of the difficulty in making the process workable, they decided to change it, leaving it to the pensioners to choose and run their own selection process. Letters were sent to the pensioner members in December, and again in April, inviting them to put forward suggestions for a selection process, but no proposal has yet been forthcoming.

Options

There is a legal requirement that at least one third of the trustees must be member-nominated. In practice the Scheme has always operated with a trustee board where half of the trustees are member-nominated. That is not unusual for trade union pension schemes.

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