This annuity will be greatly dependent on theinvestment conditions during the period toretirement as well as on the day you retire.

As a deferred pensioner, you may have the optionto transfer your USF benefits either to anotheremployer’s pension scheme or to a personalpension. If you’re thinking of transferring toyour employer’s scheme, it’s best to contact theirpensions department for more information, butif you’re considering transferring to a personalpension, things aren’t quite as straightforward!

Much of the concern expressed in the pressabout themis-sellingof personalpensions alsoapplies to thetransfer ofdeferredpensions.So, if yourfriendlyinsurancesalespersontries to

convince you to transfer, what informationdo you need to know before signing on thedotted line?

Firstly, your benefits under the USF areguaranteed - no matter what investmentconditions exist when you retire, you areguaranteed a set pension amount. Personalpensions deal in ‘pots of cash’ from which youmust purchase an annuity when you retire.

Secondly, Unilever makes no administrationcharge for looking after your pension. Oftenon transferring to a personal pension, there isa commission payment made to the advisor -a payment that will come out of your transferamount. Once the pension transfer has beencompleted, there may also be regular policyfees deducted from your ‘pot’.

Thirdly, your USF pension receives annualincreases roughly in line with inflation.You might have to pay extra into a personalpension to receive increases.

There are a number of other factors such asearly retirement and the financial security ofyour personal pension provider - the USFscheme is financially very strong withapproximately £4 billion worth of assets -which are definitely worth consideringbefore you decide whether to transfer yourUSF pension.

Example

In keeping with the fund rules, all pensionsabove the Guaranteed Minimum Pension(GMP) will be increased by 1.3% on1 October 1999. This matches the annual rateof inflation announced in August 1999. If youleft after 1 October 1998 you will receive aproportion of this increase on a sliding scale.

The USF pension increases apply only topensions above the GMP, so the increase in thetotal pension held for you by the Fund may beless than 1.3%.

As explained on page 2, the GMP is alsoincreased from your date of leaving untilretirement.

5 Pensionincreases

Pension mis-selling.Watch that transfer!

Currently, for a male retiring at 60 looking for a pensionincreasing at 3% per year with a 50% spouse’s pension,a £100,000 ‘pot’ would only provide a pension ofapproximately £4,300 per year.

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(source: Pensions World, July 1999.)

We want to improve our service to all membersof the USF, whether they have deferredpensions, are still employees, or are now retired.As Communications Manager, it is HannahClarke’s responsibility to find out what you,our customers, need and to make sure that thepensions department meets those needs.As some of you may know, Hannah recentlyorganised a representative survey of fundmembers, including deferred members, to geta feeling for your views. The results of the

survey will help Hannahtowards her ultimate goal,which is to “develop astrategy to match yourneeds and to improve theservice for our customers -the members of the fund.”

Meetingyour needs

By the time you read this,there will only be 3 monthsto go before the turn of thecentury! The media havebeen speculating for monthson the computer problemsthat may arise in the year 2000.The pensions department, aswell as Unilever as a whole,has thoroughly tested theircomputer systems to ensure thatthey are “Year 2000 compliant”and have taken appropriatesteps to guard against any problems.Contingency plans are also in place to copewith circumstances beyond our control, such aspower loss. We are confident that we will beable to continue to provide a good service toour customers over the new year period.

The fund is established under trust and isadministered by trustees. All the fund’sinvestments and other assets are managedseparately from Unilever plc. The trustees’main responsibility is to ensure that the fundis run in accordance with the Trust Deed andRules and they are legally bound to protectthe interests of the fund’s members.

We only have space to give a general overview of yourspecific benefits and early retirement options here.

To find out more, or to update your nomination forlump sum death benefits, write to:

UK Pensions Department,Unilever UKCR Ltd, Unilever House,PO Box 68, Blackfriars, London EC4P 4BQ.

6 Looking afteryour interests

Into thenext millennium

Want toknow more?

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Designed and produced by Bleach Communication Consulting Ltd.

Welcome to thefirst edition ofStaying In Touch.

We are committed to improving our communication, so let us knowyour views.

. What do you think about this new look newsletter?

. Was the information interesting?

. Did it tell you what you wanted to know?

. What else would you like to know about the pension scheme?

Please contact Hannah Clarke by e-mail on:Hannah.Clarke@unilever.com

What is a deferred pension?How do I get my benefits?

Facts and figures from the pension fund

Pension increasesPension mis-selling - watch that transfer!

Looking after your interestsMeeting your needsInto the next millenniumWant to know more?

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3 /4

5

6

StayingIn Touch

Inside

or you can write to her at: UK Pensions Department(UKPD), Unilever UKCR Ltd, Unilever House,PO Box 68, Blackfriars, London EC4P 4BQ.

This is an annual newsletter foreveryone who has worked atUnilever in the past and has apension entitlement from theUnilever Superannuation Fund(USF).

Whether you were with us formany years or just a few, whetheryou worked for us directly or fora company acquired by Unilever,you will be entitled to a pensionfrom us when you retire. Althoughyou can no longer contributetowards your Unilever pensionbenefits, they are increased everyyear and are technically known as‘deferred benefits’.

Previously you may have receiveda copy of “Pensioners News”.This was really designed for peoplewho had already retired. This year,we thought you might prefer toreceive a newsletter designedspecifically to cover pensionsissues that are relevant to you.So welcome to Staying in Touch!

Autumn 1999

Most deferred pensions will have 2 elements:

The excess pension paid by the USF in addition to your Guaranteed Minimum

Pension (GMP).

A GMP based on your National Insurance earnings.

The amounts are worked out when you leavethe USF and receive regular increases, generallyin line with inflation, until they are paid out.The second element, the GMP, is increasedevery April under rules laid down by theGovernment.

You may choose to take a tax-free cash sumwhen you retire. Depending on when you leftUnilever, you will receive this in addition toyour pension, or you can choose to give upsome of your pension for cash.

Like most things to do with pensions thissounds complicated but the bottom line is thatyour deferred pension will receive regularincreases before and after you retire. (See articleon page 5 for more information on this year’sincreases.) What’s more, if you have peoplewho are dependent on you, such as a spouseor children, they will receive a pension whenyou die.

So, a deferred pension is worth having!

But what exactly is this pension?

Normal retirement

1

2

Early retirement

Retiring outside the UK

You may have left Unilever in the last fewmonths or many years ago. Either way youwill have a deferred pension if you left:

A few months before your benefits are due, wewill write to you to explain your options. Thisis one of the reasons why it is vital that youkeep us up to date with any changes of address.

We’ll ask you to send us details of your bank orbuilding society account. We may also ask forcopies of your birth certificate, and, if you aremarried, your spouse’s birth certificate and yourmarriage certificate.

Once you have replied to our letter, we willwrite to you to finalise the details and informyou of when the first pension payment is to bemade. We will also send you the necessary taxforms so that your pension can be taxed correctly.

A few days before your first pension instalment,we will send you a Pension Payment Statement,giving details of your first payment and yourfuture monthly pension income up to the endof the tax year. After that, you’ll get a newstatement each time your pension changes andat the beginning of each new tax year.

Many of our pensioners live outside the UK,and there is no problem in paying pensions tooverseas banks. However the transfer of moneymight take a day or two and, of course, thepension is paid in UK Sterling, so the amountspayable may fluctuate as a result of changingexchange rates. If you do retire abroad, we willsupply the necessary tax forms.

It may be possible for you to take your benefitsbefore your normal retirement date but theywill be reduced in amount for early payment.The earliest age you can do this is 50 and detailsof the benefits and any options can be obtainedby writing to the UK Pensions Department.

What is adeferred pension?

How do Iget my benefits?

2PAGE

. after age 50

. before 1 July 1988 and were an employee member of the USF for at least 5 continuous years

. after 1 July 1988 and were an employee member of the USF for 2 continuous years

Deferred pensioners are ex-employees ofUnilever who have not yet retired. As one ofnearly 50,000 deferred pensioners, you form thelargest group of pension fund membership.Although you can’t contribute to the fund, thepension you have built up while you were withUnilever is preserved and will increase every year.This pension will be payable when you retire.Pensioners are people who are being paid apension from the fund.Employee members are employees still workingfor Unilever whose pension is being built upevery year.

Deferred Pensioners 49,196

Pensioners 43,426

Employee members 17,006

The audited USF Report and Accounts contains more details about the fund’s financial activitiesduring the 12 months to 31 March 1999. If you would like a copy, please write to the Secretaryto the USF at the address shown on page 6.

The size of the fund differs slightly from themarket value of investments as it also includesmonies owing to the fund or due to be paidfrom it in the short term.

The size of the fund went down slightly from£4,299m to £4,242m last year due to the saleof a number of companies, which resulted inlarge transfers being paid from the fund.

Facts & figures from the pension fund3PA

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Plus

Member Contributions (AVCs only)Company ContributionsTransfers from other fundsInvestment incomeIncrease in market value of investments(including AVCs)

£m

£m

571

136

201

350

Minus

PensionsLump sumsTransfers to other fundsExpenses

16722

20216

407

UK Shares £1,609m

Overseas Shares £1,619m

Fixed Interest Securities £554m

Cash £31m

Property & Venture Capital £372m

Membership(at 31 March 1999): 109,628

Size of Fund(at 31 March 1998): £4,299m

Size of Fund(at 31 March 1999): £4,242m

Market Value of Investments(at 31 March 1999): £4,185m

The fund finances last year

4PAGE

Running a pension scheme is a long termbusiness. We have to make sure that we haveenough money to pay pension and otherbenefits not just now but for many years inthe future. The majority of the fund’s incomecomes from investments. The fund hasperformed well in the long term.

The graph shows that, although yearly figureshave fluctuated dramatically, over the past10 years the fund’s annualised investment returnhas been 12.9%, well ahead of the annualisedinflation rate of 3.9%.

This is good news because it means that thereshould be sufficient money in the fund to payout all the pensions and other benefits for theforeseeable future.

The trustees have prepared a formal statementof their principles for investing the USF assets.This outlines their investment objectives andtheir strategy for achieving them. Thisstatement can be obtained on request from theUK Pensions Department at the address shownon page 6.

The fund’s investmentperformance

Statement ofinvestment principles

Investment Performance(Years ended 31 December)

Annualised USF investment return: 12.9%

Annualised inflation/RPI: 3.9%

89

90

91

92

93

94

95

96

97

98

USF investment returns

Annual inflation/RPI