• The benefits are based on a formulae connecting salary and service; a member knows his benefits in advance.
• The definition of salary to apply is defined in scheme rules.
• Members may or may not contribute.
• Sponsor contribution determined triennially to meet cost of promised benefits.
• Employer underwrites the risk; benefits defined by formulae does not vary with investment returns or longevity.
• Owing to the nature, structure and current membership, the Scheme is destined to wind up after the last member exits in 2027.
• Tends to be appreciated by older members of staff.

 BENEFITS PAYABLE ON RETIREMENT

       Normal Retirement

• 1/40 x Final Annual Pensionable Salary x Years of Pensionable service.
• Normal Retirement age for the Scheme is 60 years.
• 1/3 of the benefit is accessible as cash while the remaining 2/3 is paid as a monthly pension. Early Retirement Benefit.
• 1/40 x Final Annual Pensionable Salary x Years of Pensionable service.
• Benefit payable is as for normal retirement subject to a reduction factor of 3% applied for every year of service before the Age 55.
• Early Retirement is from the age of 50 years.

      ILL Health Retirement

• 1/40 x Final Annual Pensionable Salary x Years of Pensionable service.
• Years of pensionable service to normal retirement date.

BENEFITS PAYABLE ON WITHDRAWAL

• 1/40 x Final Annual Pensionable Salary x Years of Pensionable service.
• The member can access an equivalent cash lump sum of 50% of the accrued pension.
• The remaining 50% pension is deferred till attaining the early retirement age.

BENEFITS PAYABLE ON DEATH IN SERVICE

• Benefits as for Normal retirement with the pension paid to the widow and orphans.
• A group life policy provides risk cover for 4 times annual salary in the event of death.
• The spouse is entitled to 50% of the pension payable monthly.
• Eligible children up to a maximum of 4 are entitled to 12.5% of the total pension payable monthly until the age of 18 years.
• The pension for the children can be paid up to the age of 23 years upon presentation of proof that the children are still in school.

Note that the pension can be paid to a guardian in the absence of a spouse.

Risk Spectrum for Defined Benefits