The Trustees are responsible for setting the Scheme’s policy for allocating the assets among various types of investments and among investment managers. They do this in consultation with the Guarantor, who has an interest because of his ultimate responsibility for the benefit payments, and they take advice from an investment consultant.

Typically, a scheme with no contributing members and which paid pensions linked to inflation would hold a very high proportion of its assets in index linked securities issued by the UK Government. The Trustees are, however, anxious to use the existence of the Guarantee as a means to allowing a more varied investment strategy to be pursued, with a significant proportion of the Scheme’s assets remaining invested in equities. Over time, these are expected to produce higher returns but the returns can vary significantly from year to year.

Details of the actual asset allocation are published each year in the Scheme’s Annual Report and Accounts.