CLASSIC - RBS - Login with a normal pension age of 65. You have the option to start earning beneﬁts with a normal pension age of 65 every April at the Pension Election Window. This

The Royal Bank

of Scotland

Group Pension Fund

A guide for members

CLASSICA bespoke pension fund

expertly tailored for the RBS group

Contents

2 Summary of benefits

4 Joining and contributions

6 How the pension fund works

7 Benefits on retirement from Option 1

10 Members with Option 2 service

11 Benefits on retirement from Option 2

13 Additional retirement benefits

14 Tax-free lump sum

15 Family benefits

18 Benefits on leaving the Group

20 Your Fund and the State Pension

21 Other important information

26 Definition of terms

The Royal Bank of Scotland Group Pension Fund delivers a pension basedon your final pensionable salary and the time you’ve worked with the Group.In short, it’s an employer-funded plan, which combines financial security withprotection while you are building up benefits.

This booklet summarises the benefits available to you as a member of the Fund.

Over the years, several schemes from various companies that now make upthe Group have merged, and these form what are referred to as differentschedules of the Group Fund. The benefit structures of these schedules canvary slightly and you will already have been given details of any differences thatmay not be covered in this booklet, but which may apply in your circumstances.

In 2012 members were given the option to stay in their existing schedule, butcontribute an additional 5% RBSelect charge, or to earn benefits in a newschedule with a normal pension age of 65. You have the option to startearning benefits with a normal pension age of 65 every April at the PensionElection Window. This booklet details the benefits for most members underthe two different options available:

• Option 1: Benefits accrued with a normal pension age 60 (if you chosethis option then you will pay an additional 5% RBSelect charge)

• Option 2: Benefits accrued with a normal pension age of 65

You can opt out of the Fund to free up more of your ValueAccount to use forother benefits or take in cash, but you should think carefully before giving upthe valuable benefits provided by the Fund. These are summarised over thenext two pages. If you opt out, you will not be able to rejoin.

Introduction

The Royal Bank of Scotland Group Pension Fund A guide for membersThe Royal Bank of Scotland Group Pension Fund A guide for members 32

Benefits on leaving the Group

If you have less than three months’ qualifying service in the Fund, arefund of the value of your Additional Pensions Contributions (APeCs),if any, less tax

If you have at least three months’ but less than two years’ qualifyingservice, a transfer value may be paid to a pension scheme provider ofyour choice. Alternatively you can have a refund of your AdditionalPensions Contributions (APeCs), if any, less tax

If you have at least two years’ qualifying service, one of the following:

• A deferred pension• The option to transfer to another pension arrangement• A pension for your spouse/partner (payable for life) and for your

dependent children

Extra benefits

The opportunity for extra benefits by contributing to the Fund's AdditionalPension Contributions (APeC) arrangements through RBSelect

Pension benefits

A pension for life

The option to exchange part of your pension for a tax-free lump sum

Increases to your pension and your dependants’ pensions duringpayment of pension

Family benefits on death in service

A tax-free lump sum of four times salary

A pension for your spouse/partner (payable for life) and for yourdependent children

Family benefits on death after retirement

A lump sum equal to the amount you would have received over the firstfive years of payment, if you die within five years of first receiving yourpension, minus any pension already paid to you

A pension for your spouse/partner (payable for life) and for yourdependent children

Summary of benefits


Eligibility and joining

You will be a member of the Fund ifyou were a permanent or fixed termcontract employee of The Royal Bankof Scotland Group at 30 September2006, and your contract of employmentsays you are eligible for membership.You automatically join the Fund whenyou become eligible unless you choosenot to participate. Since 1 October2006, the Fund has been closed tonew members.

Opting out

You may opt out of the Fund forfuture service while still working forthe Group. You may do this throughRBSelect or by contacting GroupPension Services. Once you haveopted out, you won’t be able to rejoin.Your benefits will be calculated as ifyou had left the Group at the date youopted out.

Transfers in

You may be able to transfer benefitsfrom another pension arrangement ifthe Fund’s Trustee agrees. Pleasecontact Group Pension Services ifyou would like more information.

Contributions

The Group pays the majority of thecost of benefits from the Fund. TheGroup pays contributions towards thecost of the benefits under the Fund,as agreed with the Trustee. If you areearning benefits under Option 1 (seepage 7) then you are required tocontribute an additional 5% RBSelectcharge to maintain the lower normalpension age.

Money paid into the Fund is held in atrust, the assets of which are entirelyseparate from the Group’s money.All benefits are funded through thistrust fund.

Temporary absence

If you are away from work on maternity,adoption or paternity leave, yourpensionable service will continue. Fordetails of how your pension would beaffected by other types of temporaryabsence, please contact GroupPension Services.

Joining and contributions

Give yourbenefit a boost

You don't have to makecontributions to theFund as an employee.You may, however,choose to makeAdditional PensionsContributions (APeCs),which provide atax-effective way tosave for the future.

Extra contributions

You may wish to build up extra pensionbenefits for a number of reasons:

• You may not be able to obtain themaximum service in the Fund, or

• You may wish to save for an earlyretirement, or

• You may just want a larger pensionat normal pension age.

Additional Pensions Contributions(APeCs) give you the opportunity fortax-efficient saving through the Fund.You should, however, also consider othertax-effective savings products such asIndividual Saving Accounts (ISAs) orstakeholder pensions, if appropriate toyour circumstances.

APeCs could allow you to receive:

• Tax relief on your contributions atthe highest rate of tax you pay.Your contributions are deductedfrom your salary before tax.

• Largely tax-free interest onyour investment.

Your contributions will be invested inan account set up in your name, toprovide you with additional benefits.

APeCs can only be changed during thePension Election Window.

You can make tax-free contributionsup to the Annual Allowance orlimited by the RBSelect restriction(benefits costing less than 70% ofValueAccount), whichever is lesser.When you retire, the value of youraccount will be used to buy extrapension for you or your dependants.Alternatively, it may be taken as partof your tax-free cash from the Fund.

If you die before drawing your pension,the value of your account will be paid toyour beneficiaries as a tax-free lump sum.

For further information about youroptions, please contact Group PensionServices or refer to the RBSelect pages.


Option 1 and Option 2 benefits

In 2012 the Group gave members the option to stay in their currentschedule and continue to earn benefits with a normal pension age of 60(Option 1) or to move to a new schedule and earn benefits in the futurewith a normal pension age of 65 (Option 2). If members chose Option 1then they are charged an additional 5% RBSelect charge, Option 2 has noadditional charge.

Members who have only Option 1 Service

If you have stayed in your original schedule and paid the additional 5%RBSelect charge then you should read this section. If you opted to moveto the normal pension age 65 schedule then read the section titled“Members with Option 2 service”.

To show how the Fund works in real life, here are two examples:

Kate

Kate takes her pension at 60 with a final pensionable salary of £15,000.After 10 years’ pensionable service, her pension will be:

1/60 x £15,000 x 10 = £2,500 a year

Ben

If Ben takes his pension at age 57 with a final pensionable salary of£30,000 after 30 years’ pensionable service, his pension will be:

1/60 x £30,000 x 30 x 0.86 = £12,900 a year

The reduction in pension to allow for early payment for a man aged 57 iscurrently 0.86. The reduction factor for early payment is determined by theGroup and Trustee after considering actuarial advice and is subject toreview from time to time.

How the Pension Fund works

Normal retirement pension

If you take your pension at normalpension age it will be worked out as inKate’s example:

1/60 x final pensionable salaryx pensionable service

Your normal pension age is the earliestage at which you are entitled to anundiscounted pension from the Fund.In most circumstances this is age 60,but some employees have a normalpension age which is different fromage 60 (you should contact GroupPension Services if you require anycalculations as your benefits may bemore complex than shown here).

The Group will allow you to continueemployment after this date and receivecredit for pensionable service accruedafter your normal pension age.

If you were a member of The RoyalBank of Scotland Staff PensionScheme before 1 January 2002, yourpension will be reduced from StatePension Age by:

1/40 x State Pension deductionx pensionable service before1 January 2002

Benefits on retirement from Option 1


Ordinary early retirement

With your Employer’s consent, you maytake ordinary early retirement with animmediate pension at any time fromage 55. Your pension will be workedout in the same way as at normalpension age, based on your finalpensionable salary and pensionableservice at the time you retire, andreduced permanently according toyour age of retirement.

The benefit is reduced due to the factthat it is expected to be paid over alonger period of time than it would ifyou had taken it at normal pension age.

If you take ordinary early retirementyour pension will be worked out as inBen’s example:

(1/60 x final pensionable salaryx pensionable service) x thereduction factor

If you leave the Group at yourEmployer’s request, other than formisconduct, you’ll have the option toretire early without a reduction inbenefits if you are age 55 or over.

In such a case, your pension benefitwould be worked out as described fornormal retirement, using your finalpensionable salary at the time ofleaving and pensionable service todate of leaving.

Early retirement due to ill-health

You may retire before normal pensionage due to incapacity if you have beenabsent from work for five years and sixmonths, and have been receivinglongterm disability benefits. But first theTrustee must review your request forearly retirement and decide whether ornot your condition meets the definitionof incapacity. In such a case, yourpension benefit would be worked outas described above, using your finalpensionable salary at the time ofretirement, but your pensionableservice would assume you continued inservice to age 60 (or your currentnormal pension age if different).

You may ask to retire without waitinguntil the end of the long-term disabilityperiod. If the Trustee agrees that yourcondition meets the definition ofincapacity, your pension will be basedonly on service up to the date youretire unless the Group and Trusteeagree otherwise.

Late retirement

The Group will permit you to continuein employment beyond age 60,continuing in pensionable serviceuntil you take your pension or leavethe Fund.

If you continue to work past age 60,you will continue to accrue additionalpensionable service up to a maximumof 45 years’ pensionable service. Youmay wish to consider transferring toOption 2 at age 60 to benefit from thelate retirement factor offered.


If you have moved to the normal pension age 65 schedule then you will havetwo parts to your benefits: the pension earned before you moved schedule andthe pension earned after. Please remember that you must take both of theseparts of pension at the same time.

To show how the Fund works in real life, here are two examples:

Gillian

Gillian moved to the normal pension age 65 schedule in April 2013. She takes herpension at 65 with a final pensionable salary of £20,000. She had 8 years serviceto April 2013 and has 5 years service after, her pension will be:

(1/60 x £20,000 x 1.3) + (1/60 x £20,000 x 5) = £5,133 a year

The pension earned prior to April 2013 is increased to reflect the fact that it is beingpaid after age 60. The increase factor is determined by the Group and the Trusteeafter considering actuarial advice and is subject to review from time to time.

Matthew

Matthew moved to the normal pension age 65 schedule in October 2012. He had25 years service to October 2012 and when he takes his pension at age 63, hehas an additional 5 years service since October 2012. His final pensionablesalary is £30,000, his pension will be:

(1/60 x £30,000 x 25 x 1.2) + (1/60 x £30,000 x 5 x 0.9) = £17, 250 a year

The pension earned prior to October 2012 is increased to reflect the fact that it isbeing paid after age 60. The pension earned after October 2012 is reduced toreflect the fact it is being paid before age 65. The increase and reduction factorsare determined by the Group and Trustee after considering actuarial advice andare subject to review from time to time.

Members with Option 2 Service

Normal retirement pension

If you take your pension at age 65 itwill be worked out as in Gillian’sexample:

(1/60 x final pensionable salaryx old schedule pensionable servicex the increase factor) + (1/60 x finalpensionable salary x normal pensionage 65 service)

Age 65 is the earliest age at whichyou are entitled to a fully undiscountedpension from the Fund. The Groupwill allow you to continue employmentafter this date and receive credit forpensionable service accrued afteryour normal pension age.

If you were a member of The RoyalBank of Scotland Staff PensionScheme before 1 January 2002, yourpension will be reduced from StatePension Age by:

1/40 x State Pension deductionx pensionable service before1 January 2002

Ordinary early retirement

With your Employer’s consent, you maytake ordinary early retirement with animmediate pension at any time fromage 55. Your pension will be workedout in the same way as at normalpension age, based on your finalpensionable salary and pensionableservice at the time you retire, andreduced permanently according toyour age of retirement.

The benefit is reduced due to the factthat it is expected to be paid over alonger period of time than it would ifyou had taken it at normal pension age.

If you take ordinary early retirementyour pension will be worked out as inMatthew's example (factor will dependon age):

(1/60 x final pensionable salary x oldschedule pensionable service x theincrease/reduction factor fromage 60) + (1/60 x final pensionablesalary x normal pension age 65service x the reduction factor fromage 65)

Benefits on retirement from Option 2


If you leave the Group at yourEmployer’s request, other than formisconduct, you’ll have the option toretire early without a reduction inbenefits if you are age 55 or over.

In such a case, your pension benefitwould be worked out as described fornormal retirement, using your finalpensionable salary at the time ofleaving and pensionable service todate of leaving.

Early retirement due to ill-health

You may retire before normal pensionage due to incapacity if you have beenabsent from work for five years and sixmonths, and have been receivinglongterm disability benefits. But first theTrustee must review your request forearly retirement and decide whether ornot your condition meets the definitionof incapacity. In such a case, yourpension benefit would be worked outas described above, using your finalpensionable salary at the time ofretirement, but your pensionableservice would assume you continuedin service to age 65.

You may ask to retire without waitinguntil the end of the long-term disabilityperiod. If the Trustee agrees that yourcondition meets the definition ofincapacity, your pension will be basedonly on service up to the date youretire unless the Group and Trusteeagree otherwise.

Late retirement

The Group will permit you to continuein employment beyond age 65,continuing in pensionable serviceuntil you take your pension or leavethe Fund.

If you continue to work past age 65,you will continue to accrue additionalpensionable service up to a maximumof 45 years’ pensionable service.

Payment of pensions

Under both Option 1 and Option 2your pension will be paid monthly andis taxed in the same way as earnedincome. Payment is made directly intoyour UK bank account.

Pension increases

Increases awarded to pensions inpayment apply to pensions paid tomembers or their dependants.

Your pension will automatically increaseeach year in line with price inflation, upto a maximum level depending onwhen you commenced employmentwith the Group, and which schedule ofthe Group Fund you are a member of.In the majority of circumstances, theannual increase will be price inflationup to a maximum of 5% per annum.However:

• If you joined the Group after 30 June2005, the maximum increase is 2.5%.

• If you were previously a member ofThe Royal Bank of Scotland StaffPension Scheme, the maximumincrease for pension relating toservice before 6 April 1997 is 3%.

Further increases may be granted atthe discretion of the Trustee and theGroup, with regard to the financialimpact on the Fund and after takingactuarial advice.

Tax-free lump sum optionat retirement

Whenever you begin to draw yourpension, you have the option ofexchanging part of your pensionfor a tax-free lump sum. Of course,the pension benefit paid to you willbe reduced to take account ofthis payment.

Your remaining pension benefit mustnot be smaller than the minimumneeded to meet contracting outrequirements. The maximum lump sumyou can take is 25% of the value ofyour benefits in the Group Fund(subject to a maximum of 25% ofthe Lifetime Allowance).

See the example on page 14.

Any dependant’s pension payable onyour death after retirement will bebased on your full pension, and willnot be reduced because you haveexchanged part of your pension fora lump sum.

Additional retirement benefits

Nigel

Nigel takes his pension at age 64, his full pension at this age (calculated as setout above) is £12,000. He decides to exchange £2,000 of his pension for alump sum.

The amount of lump sum paid for each £1 of pension given up for a man aged64 is currently £13.8:

His lump sum will be £2,000 x 13.8 = £27,600 and his reduced pension will be£10,000 a year

The rates of exchange for converting pension to a lump sum are subject to reviewfrom time to time by the Trustee and the Group.

Tax-free lump sum

The Royal Bank of Scotland Group Pension Fund A guide for members15The Royal Bank of Scotland Group Pension Fund A guide for members14

Death in service

If you die on or before normal pensionage, while you are still working for theGroup, your dependants will receivethe following benefits:

Lump sumA lump sum equal to four times yoursalary element will be paid to yourspouse/partner, relatives, dependantsor anyone else nominated in writingby you. The Trustee has discretionover who this benefit is paid to.

Spouse’s/civil partner’s pensionEqual to 50% of your prospectivepension based on your finalpensionable salary at death and thepensionable service you would havecompleted by normal pension age.Note that this will be calculated to age60 under Option 1 and age 65 underOption 2 as it is prospective serviceto normal pension age that is used.

Partner’s pensionEqual to the spouse’s/civil partner’spension, as calculated above, andpaid instead of the spouse’s/civilpartner’s pension.

Children’s pensionEqual to a percentage of yourprospective pension, depending onthe number of children you have:

• One child 20%• Two children 35%• Three or more children 50%

If no spouse/civil partner or partner’sbenefit is payable, the children’spension benefit will be increased:


Your children qualify if they are 18 oryounger (23 or younger if pursuingfull-time education).

You should complete a Lump SumNomination Form, available from GroupPension Services or online, to let theTrustee know your wishes. The Trusteemust have discretion over who shouldreceive the lump sum, although theywill always consider your wishes whenmaking a decision. Payment is madein this way so that your beneficiariescan receive the lump sum benefit,free of tax.

Remember to update your Lump SumNomination Form immediately if yourcircumstances change.

Family benefits

The Royal Bank of Scotland Group Pension Fund A guide for members17The Royal Bank of Scotland Group Pension Fund A guide for members16

If you are not married/have not enteredinto a civil partnership, you maynominate a qualifying partner bycompleting a Partner/Dependant’sPension Nomination Form availablefrom Group Pension Services or online.

At the request of the beneficiaries, theTrustee may pay a lump sum instead ofpart of any spouse/partner pension orchildrens’ pension, subject to anystatutory restrictions.

Death after retirement

Should you die after you retire,your dependants will receive thefollowing benefits:

Five-year pension guaranteeIf you die within the first five years ofreceiving your pension, the balance ofthe first five years’ payments will bepaid to your dependants as a lumpsum. The amount they receive will bebased on the rate at which pensionbenefits were being paid to you on thedate of your death. Considercompleting a Lump Sum NominationForm for this lump sum.

Spouse’s/civil partner’s pensionEqual to 50% of your full pension,before any reduction for ‘tax-free lumpsum option’ benefits taken atretirement.


Children’s pensionEqual to a percentage of your fullpension before any reduction for‘tax-free lump sum option’ benefitstaken at retirement. The percentagedepends on the number of childrenyou have:


If no spouse/civil partner or partner’sbenefit is payable, the children’spension benefit will be increased:



The spouse’s/civil partner’s pensionmay be reduced if you married/enteredinto a civil partnership after normalpension age and die within six monthsof marriage/civil partnership.

If you are not married/have not enteredinto a civil partnership, you maynominate a qualifying partner bycompleting a Partner/Dependant’sPension Nomination Form availablefrom Group Pension Services.

Death after leaving the Group

If you die after you leave employmentwith the Group, but before you takeyour pension, your dependants willreceive the following benefits:

Spouse’s/civil partner’s pensionEqual to 50% of your deferred pensionat the date of death.


Children’s pensionEqual to a percentage of your deferredpension at the date of your death,depending on the number of childrenyou have:


If no spouse/civil partner or partner’sbenefit is payable, children’s pensionbenefit will be increased:



If you are not married/have not enteredinto a civil partnership, you maynominate a qualifying partner bycompleting a Partner/Dependant’sPension Nomination Form availablefrom Group Pension Services.

Note

If you are female and had service inthe National Westminster Bank PensionFund prior to 1 April 1988, this servicewill not usually count towards FamilyBenefits. You may contact GroupPension Services for more details.


If you have less than three months’qualifying service, the benefit you willreceive is a refund of the value of anyAdditional Pensions Contributions(APeCs) you made to the Fund, lesstax. You will be reinstated in the StateScheme for your period ofmembership.

If you have at least three months’ butless than two years’ qualifying service,you have the choice of:

• Transferring your pension rightsearned in the Fund to the pensionprovider of your choice, or

• A refund of the value ofany Additional PensionsContributions (APeCs) youmade to the Fund, less tax.

The transfer value will be calculated onthe same basis as detailed in the nextsection. If you do not complete thetransfer within a specified time afterleaving service, you will lose the right tothe benefit.

If you have at least two years’pensionable service in the Fund, youcan choose to defer your pension ortransfer your benefits to anotherpension arrangement.

A deferred pension

You can leave your benefits in the Funduntil you take your pension. Your deferredpension will be worked out as describedfor a normal retirement pension, basedon your final pensionable salary andpensionable service at the time youleave. Your pension will be increased inline with price inflation up to 5% for eachcomplete year between leaving andwhen you take your pension (no earlierthan age 55 unless ill-health).

If you die before you start to drawyour pension, your spouse/partnerand children will receive pensions asdescribed on page 15 based on yourdeferred pension increased to thedate of your death. You can drawyour deferred pension at normalpension age, or from age 55 with theTrustee’s consent.

You can contact Group Pension Servicesfor further information about the earlyretirement option nearer to the time ofyour retirement.

Your pension will be reduced if paidearly, to account for the longer period oftime over which the pension maybe paid. If you are suffering fromincapacity you may be able to draw yourdeferred pension before reaching age 55.

Benefits on leaving the Group

A transfer

You can request a transfer of yourbenefits to another pensionarrangement – that is, a newemployer’s plan, a personal pension,a stakeholder pension or aninsurance policy.

The transfer value payable will be thevalue of your benefits under the Fundand will be calculated in two stages:

1. An estimate of the amount thatwould be needed to pay yourown benefits at retirement andyour spouse’s/partner’s andchildrens’ pensions on your death

2. An estimate of the sum that wouldneed to be invested today toproduce that amount by normalpension age – this will be yourtransfer value.

This calculation is based on variousassumptions, including those on futureinvestment returns, inflation rates andaverage life expectancy.

It is worked out in a way that is agreedupon by the Fund’s Trustee on advicefrom the Fund’s actuary. The transfervalue includes an allowance for bothguaranteed pension increases and for

discretionary increases to account forthe effects of inflation. An adjustment isthen made to reflect current conditionsin the investment markets and,because of that, transfer values can godown as well as up. You may normallyrequest a quotation of your transfervalue once a year. The Trustee reservesthe right to make a charge for anyadditional quotations. The amount isthen guaranteed for three months. Ifyou do not transfer within that period,you forfeit the right to transfer foranother year unless the Trustee agreesotherwise.

If you have made any APeCs or haveany money purchase benefits within theFund, the transfer value of the APeCsor money purchase benefits is simplythe value of your investments at thedate of transfer. The three-monthguarantee, therefore, is not relevant tothese investments.

The Royal Bank of Scotland Group Pension Fund A guide for members 21The Royal Bank of Scotland Group Pension Fund A guide for members20

The State currently provides two levelsof retirement benefit:

Level 1The basic State Pension, which is paidat a flat rate to anyone who has madesufficient National Insurance (NI)contributions during their working life.The State Pension age for women willgradually increase from 60 to 65 overthe period 2010 to 2018 and will thenincrease from 65 to 66 for both menand women by 2020 and continue toincrease after that. To work out yourstate pension age go to:

http://www.pensionsadvisoryservice.org.uk/state-pensions/state-pension-age-calculator

Level 2The State Second Pension (S2P).Your level of pension under the StateSecond Pension depends on yourearnings between the lower and upperearnings limits (earnings on which youpay NI contributions).

As a member of the Fund, you arecontracted out of the earnings relatedelement of the State scheme. Thismeans the S2P portion of your StatePension is replaced by your pensionfrom the Fund. Consequently, you andyour Employer will normally payreduced NI contributions.

To contract out, the Fund must satisfythe reference scheme test. Thiscertifies that the Fund meets a highGovernment-set standard which allowsit to contract out of State-sponsoredplans.

There are certain minimumrequirements as to how, when, and towhom the contracted out minimumbenefits may be paid. You will be toldif this affects your benefit optionswhen these become payable.

Your Fund and the State Pension Other important information

Benefits for part-timers

If you work part-time, you will receivebenefits in the same way as all othermembers. Pension benefits will bebased on the pensionable salary thatyou would have had if you workedfull-time. However, your years ofpensionable service are scaled downin proportion to the hours of a full-timeworker. Lump sum benefits payable ondeath in service are based on youractual pensionable salary.

HM Revenue & Customs allowance

The payment or building up ofbenefits which are in excess ofthe Annual Allowance or LifetimeAllowance may result in additionaltax liabilities for a member.

Tracing your benefits

A pensions registry has been set up tohelp people who have lost contact witha pension plan in which they havedeferred benefits. Information aboutyour Fund has been supplied to thisregistry. If you should ever need theservice, you should apply in writing to:

Pension Tracing ServiceThe Pension ServiceTyneview ParkWhitley RoadNewcastle upon TyneNE98 1BA

Tel: 0845 6002 537

Data Protection Act 1998

All information concerning employeesand their dependants is held under theprovision of the Data Protection Act1998. The Trustee is regarded as theData Controller in respect of the data,and any queries in relation to dataprotection should be addressed toGroup Pension Services at the addressshown on page 25. Data will be treatedby the Group and the Trustee and anythird party as confidential. It may beused for both employment and Fundadministration purposes and thepersons to whom the data may bedisclosed will include any insurancecompany, or other organisationconcerned with the administration ofthe Fund. By joining the Fund you aresignifying that you give your consent forthe Trustee to hold the necessary datato calculate your benefits and to usethe data for any purpose necessaryfor the administration of the Fund.


Some data (e.g. in relation to your healthor personal life) is regarded as ‘sensitivepersonal data’ and cannot be usedwithout your specific consent at thetime. Therefore, any application forill-health retirement will require yourconsent to use the relevant data onyour state of health.

Whilst the information held by theTrustee is used primarily for thepurpose of administering the Fund,the Trustee may authorise the use ofcertain data for sending you details ofproducts provided by companies ofthe Group. A general description of thecategories of people and organisationsto whom the information may bedisclosed is listed on the DataProtection register. You may inspect thisor obtain a copy from the InformationCommissioner’s Office.

Fund amendments

While the Group intends to continue toallow members to build up benefits forfuture service, it reserves the right toalter the Fund in the future, with theconsent of the Trustee, and subject tothe Trust Deed and Rules of the Fund.

Divorce

A Court may make an order on yourpension benefits under the Fund aspart of your divorce proceedings. TheTrustee must comply with any ordermade by the Court. This order may‘earmark’ a percentage of yourbenefits on retirement or death to bepaid to your ex-spouse. Alternatively,for divorce proceedings started on orafter 1 December 2000, the Court maymake a pension sharing order, wherebyyour pension benefits will be splitbetween you and your ex-spouse. Yourown pension benefits will be reducedby an amount declared in the Courtorder, and your ex-spouse will receive acredit for this amount. Your ex-spousewill be required to transfer theirpension credit to another pensionarrangement. The Fund will not allowpension credits resulting from pensionsharing orders to remain invested inthe Fund.

Further details can be obtained in aspecial ‘Pensions & Divorce’ leaflet,which has been prepared to helpmembers understand the processesinvolved. You can obtain a copy of theleaflet from Group Pension Services.

Dissolution of civil partnerships

The dissolution of a civil partnershipwill generally be treated in the sameway as a divorce.

Resolving disputes

The Trustee aims to run the Fund in theinterests of all members. If you dohave a problem, you can always raise itinformally by contacting Group PensionServices. If this does not resolve theproblem, there is a formal disputeresolution procedure you should follow.More information is available fromGroup Pension Services. You can alsotake your case to the PensionsAdvisory Service (TPAS) at any timeduring the dispute procedure. TPASoffers advice to help the peopleconcerned to resolve disputes betweena member and the Trustee oradministrators of an occupational orpersonal pension plan.

If TPAS or the internal procedurecannot settle your dispute, you canthen apply to the PensionsOmbudsman. The Ombudsman hasbeen appointed to oversee disputeswhich cannot be resolved on avoluntary basis, and can deal with legalpoints, with any decision made being

legally binding on everyone concerned,subject to appeal to the High Court.Both the Pensions Ombudsman andTPAS can be contacted directly at:

11 Belgrave RoadLondon SW1V 1RB

Tel: 020 7630 2200(Pension Ombudsman)

Tel: 0845 6012 923 (TPAS)

The Pensions Regulator

The Pensions Regulator is responsiblefor overseeing the running ofoccupational pension schemes in theUK. The Pensions Regulator has wideranging powers and is able tointervene in the running of pensionschemes where Trustees, employers orprofessional advisers fail in their duties.The Pensions Regulator can becontacted at:

Napier HouseTrafalgar PlaceTrafalgar StreetBrightonEast Sussex BN1 4DW

Or on 0845 600 0707 or at:

[email protected]


Combined pension forecasts

Each year, the Group distributes apersonalised Total Reward Statement toemployees of the Group. Included inthis statement are details of thepension benefits you could expect toreceive from the Fund at retirement,together with those that would beprovided if you die in service.

In addition to the pension from thisFund, most members will also receive apension from the State.

Following the launch of an initiative bythe Government called ‘CombinedPension Forecasts’, we are able toprovide you with combined details ofboth your Fund pension and StatePension in the Total Reward Statementswhich are distributed by the Groupeach year.

To enable us to provide this additionalinformation for you, the Group needs tosend some information about you to theDepartment for Work & Pensions(DWP).

The information that will be sent isas follows:

• Your surname or family name• Your forenames• Your gender• Your date of birth• Your National Insurance number• Your employee reference number.

In return, the DWP will then be ableto tell us about:

• The State Pension you haveearned so far

• What your State Pension is likelyto be when you take your pension

• The age at which you can receivea state retirement pension.

However, if you do not want us to sendthis information to the DWP, then youmust register your objection with GroupPension Services. If you do this, yourfuture Total Reward Statements will notinclude this State Pension information.

Even if you do not currently object toour giving information about you to theDWP, you may do so at any time in thefuture by contacting Group PensionServices.

Opting out and RBSelect

Please note that whilst all membershave the right to opt out of the GroupFund at any time, references to freeingup ValueAccount as a result do notapply if you are not RBSelect eligible.

Any further questions?

The Pensions Act 1995 gave membersfurther rights to information about theFund. For example, you may ask to seethe Statement of Investment Principlesdrawn up by the Trustee.

The Trustee has a good track record ofkeeping members informed about theprogress of the Fund – every year itproduces a readable summary of theFund report and the full report isalways available on request. If there isanything else you would like to knowabout your benefits or the Fund ingeneral, Group Pension Services willbe happy to help.

Group Pension Services

Group Human ResourcesThe Royal Bank of Scotland GroupCity Link House4 Addiscombe RoadCroydon CR9 5PB

email: [email protected]

Tel: 0808 100 4242

This publication is also available inalternative formats. If you wish toreceive this publication in Braille,Large Print or Audio please contactGroup Pension Services.


Actuary An independent personor firm that is professionallyqualified to give advice as to thefinancial position of The RoyalBank of Scotland Group PensionFund (the Fund). The actuary willalso give advice regarding thefuture funding of the Fund andother financial matters.

Annual Allowance The AnnualAllowance is the amount by whichthe value of your pension cangrow each year without losing taxrelief. The Annual Allowance from6 April 2012 is £50,000, reducingto £40,000 from 6 April 2014.Subsequent changes to theAnnual Allowance will be set bythe Government.

Civil partner The person withwhom you have entered into acivil partnership, at the time ofyour death, under the CivilPartnerships Act 2004.

Contracted out As a member ofthe Fund, you do not participatein the State Second PensionScheme. This results in reducedNational Insurance contributionsfor you and your employer.

Deferred pension The pensionyou have earned up to the dateyou leave the Fund and held foryou until your normal pension age.

Dependant A person who isdependent or interdependent onyou for financial support.

Earnings cap A cap on earningsused for calculating pensioncontributions and benefits.Reviewed by the Group each year,the cap is set at £130,009 for the2012/13 tax year and £132,609 forthe 2013/14 tax year.

Employer The company withinThe Royal Bank of Scotland Groupthat employs you.

Final pensionable salaryThe 12 best consecutive monthsof pensionable salary that youhave had in your last five yearsof membership in the Fund.

Fund The Royal Bank of ScotlandGroup Pension Fund.

Group The Royal Bank ofScotland Group plc or anysubsidiary company with specificpowers under the Fund includingNational Westminster Bank plc asthe principal employer for the Fund.

GMP A part of your pensionsimilar in amount to the earningsrelated State Pension you wouldhave received for service between6 April 1978 and 5 April 1997 ifyou had not been Contracted-outof the state scheme.

Incapacity A physical or mentalincapacity that prevents you fromfollowing your normal occupationwith any employer. The Trustee willmake the final decision as towhether or not your condition meetsthe requirements for incapacity.

Definition of terms

Lifetime Allowance The LifetimeAllowance is the total value of allyour private and occupationalpension provision (excluding anyState Pension) which you canbuild up without incurring anadditional tax charge. The LifetimeAllowance from 6 April 2013 is£1.5 million, reducing to £1.25million from 6 April 2014.Subsequent changes to theLifetime Allowance will be set bythe Government.

Lower earnings limit Set by theGovernment each year, theminimum amount you must earnbefore you are required to makeNational Insurance contributions(£5,568 a year as of April 2012).

Normal pension age The age atwhich you are entitled to take yourpension without adjustment underthe scheme rules. This is age 60under option 1 and age 65 underoption 2. Pension can be taken atany age from 55, although consentmay be required.

Option 1 Refers to the optionto continue to earn benefits witha normal pension age of 60 inreturn for paying an additional5% RBSelect charge.

Option 2 Refers to the option tomove to the normal pension age65 schedule and earn benefitsgoing forwards under thisschedule. The choice to move toOption 2 is given every April aspart of the Pensions ElectionWindow.

Partner The person who hasco-habited with you for at least sixmonths, and who is financiallydependent on you when you die,and whom you have nominated asa qualifying partner for approvalby the Trustee. You can nominateyour Partner only if you have nospouse/civil partner.

Pensionable salary This is thePensionable Salary that you areinformed of annually. Increases inPensionable Salary take placeeach 1 April and are subject to anannual limit which is the lowest of:

• The actual percentage increasein your salary or

• The annual rate of increase inUK Consumer Price Index (CPI)over the 12 months ending onthe previous 30 September or

• 2%

Pensionable service Completeyears and months of Fundmembership. The maximumservice under Option 1 is 40 yearsbefore age 60 and an additional 5years available after age 60.Under Option 2 the maximumservice is 45 years.

Qualifying serviceYour pensionable service in theFund plus any years of servicerelating to pension benefits youhave transferred in from anotherpension arrangement.

Salary Your basic salary, orthe salary element of yourValueAccount.

The Royal Bank of Scotland Group Pension Fund A guide for members28

Spouse The person to whomyou are legally married at thetime of your death and who normallyresides with you.

State pension deductionAn amount equal to 30% of the annualbasic flat-rate State pension for a singleperson at the time of the benefitcalculation.

Trust An arrangement where a trusteeholds assets or money for the benefit ofthe members in accordance with theterms set out in a trust deed. Anymoney placed in the Trust by the Groupor members will be held separatelyfrom the Group’s other assets. The useof a trust for pension schemes alsoachieves tax advantages for the Fundand its members.

Trustee RBS Pension Trustee Limited,appointed to oversee the running ofthe Fund in the best interests of themembers and in accordance with FundRules. The Trustee company is staffedby directors who are nominated to theirposts by the Group and by membersof the Fund. These directors includecurrent active members andpensioners of the Fund.

Upper earnings limit Set by theGovernment each year, the maximumamount of earnings on which you mustmake National Insurance contributions(£42,480 a year as of April 2012).

The Fund is set up under a trust andthe full details of the terms andconditions are set out in the formalTrust Deed and Rules.

The purpose of this booklet is todescribe the benefits of the Fund andwe’ve taken care to make sure it’s acorrect summary of the Rules.However, please note that this bookletdoes not confer any entitlement tobenefits. This can only be conferred bythe Trust Deed and Rules. If there isany discrepancy between this bookletand the Trust Deed and Rules, the TrustDeed and Rules will prevail. A copy ofthe Trust Deed and Rules is availablefrom Group Pension Services.

This booklet is based on currenttax and other legislation, whichmay change.

The Fund is registered with HMRevenue & Customs under Chapter II,Part IV of the Finance Act 2004.

The Royal Bank of Scotland Group plcRegistered in Scotland No. 45551Registered Office: 36 St. Andrew SquareEdinburgh EH2 2YB

February 2013

Documents

CLASSIC - RBS - Login with a normal pension age of 65. You have the option to start earning beneﬁts with a normal pension age of 65 every April at the Pension Election Window. This