Marks and Spencer 1998 Annual Report Download - page 43

3 DIRECTORS’ PENSION INFORMATION continued
Increase/(decrease) Increase/(decrease)
in transfer value in in pension earned in
Years of excess of inflation( 1) excess of inflation(1)
Age at service at
during the year ended during the year ended Accrued entitlement at year end
31 March 1998 31 March 1998 31 March 1998( 3) 31 March 1998 31 March 1998(2) 31 March 1997
£000 £000 £000 £000
Sir Richard Greenbur y( 4) 61 44 (289) (86) 415 453
J K Oates(5) 55 14 621 38 268 221
P G McCracken 49 22 311 22 157 131
P L Salsbur y 48 27 354 25 189 159
Lord Stone of Blackheath 55 30 303 19 204 178
R Aldridge 51 24 243 16 111 92
J R Benfield 48 27 204 14 115 98
R W C Colvill 57 13 164 10 73 61
Mrs C E M Freeman 45 23 168 13 78 63
D K Hayes 49 28 199 14 111 94
B S Morris 50 27 103 7 59 46
J T Rowe 50 23 228 15 98 80
S J Sacher 57 30 88 5 159 148
P P D Smith 57 32 155 10 135 121
D G Trangmar 58 32 347(6) 2 157 150
(1) Inflation has been assumed to be equivalent to the actual rate of price inflation which was 3.6% for the year to 30 September 1997. This
measurement date has been amended in accordance with the Stock Ex change Listing Rules.
(2)
The pension entitlement shown above for the 15 participating directors is that which would be paid on retirement based on ser vice to 31 March
1998. A t State Pension A ge this will be reduced by a proportion of the Basic State Pension.
(3)
In compliance with the Pensions Act 1995, the calculation of transfer values is now linked to UK equity dividend yields. This has resulted in
additional increases within the amounts shown.
(4)
The figures for Sir Richard Greenbury reflect the fact that, having attained normal scheme retirement age of 60 (before it was changed to age 65),
he chose to receive commutation on 1 July 1997. Had he not taken commutation, the relevant figures would have been £181,000, £11,000,
£512,000 and £453,000 respectively .
(5) The pension for Mr J K Oates is based on a uniform accrual of pension of two-thirds of final salar y at the age of 60
.
(6) The greater part of the actuarial increase in the transfer value in respect of Mr D G Trangmar relates to the effect, on the year, of his full pension
being paid immediately following his retirement at 31 March 1998.
(7) Mr C Littmoden is not shown in the above table because he has ceased to accrue benefits in the UK Scheme during his time in North A merica.
His accrued entitlement at the time of his transfer to North A merica was £64,000.
(8) The pension entitlement shown ex cludes any additional pension purchased by the memberÕs Additional Voluntary Contributions.
(ii) Early Retirement Plan
The Board recognises the need to maintain a proper flow of succession to senior management positions. It has therefore decided that although the
CompanyÕs Pension Scheme is administered assuming a normal retirement age of 65 for all staff, senior management should have a contractual
retirement age of 60. To meet the same successional needs, it may on occasion be appropriate to ask a member of senior management to retire
before the age of 60. To facilitate the smooth implementation of this process the Company has established an Early Retirement Plan for senior
management. Where such a request is made by the Company the Committee may, at its discretion, offer an unfunded Early Retirement Pension,
separate from the Company pension, which will be payable from the date of retirement to age 60. To ensure that early retirement does not confer
an advantage over continued employment the value of the Early Retirement Pension may not exceed the value of the individualÕs total net salary
less net Company pension from actual date of retirement to age 60. Each Early Retirement Pension must be approved individually by the
Remuneration Committee. The Early Retirement Pension is fully tax able; it is fully commutable at the election of the recipient.
Mr D G Trangmar retired as an ex ecutive director on 31 March 1998 and has been awarded an annual Early Retirement Pension of £56,000.
The Hon David Sieff, who retired as an ex ecutive director on 31 March 1997, received an annual Early Retirement Pension of £49,000 during the
period under review.
In relation to three former directors, their Pension Scheme entitlement is supplemented by an additional, unfunded, pension paid by the Company.
Pensions paid by the Company to former directors were:
1998 1997
£000 £000
Lord Sieff of Brimpton 61 60
The Lord Rayner 83 81
C V Silver 79 77
223 218
Due to the continuing ill health of Lord Sieff the Company no longer incurs the cost of providing administrative support for the position of Honorary
President but has instead met costs relating to his necessary daily care assistant. Payments of this nature in the period under review amount to
£69,197.
Additional payments amounting to £70,000 (last year £70,000) have been made to Mr C V Silver in respect of consultancy services provided to the
Company .
4 PAYMENTS TO FORMER DIRECTORS
REPO RT OF TH E REM UNERATION CO M M ITTEE
MA RKS A ND SPENCER p.l.c. 41