By Russell Hotten, Industry Editor
Last Updated: 12:19am BST 02/10/2007
Oil company Royal Dutch Shell has halted payments into its £12bn UK pension fund after latest valuations showed the scheme to be heavily in surplus.
The surprise move, the first pension holiday taken by the Anglo-Dutch company since 2002, will be reviewed next year.
Shell’s decision reflects the generally improving health of defined benefit schemes, but experts said the company’s move was unlikely to be followed by other large firms. Contribution holidays were widespread until the stock market falls early this decade hit investments and plunged many schemes into deficit.
The 46,000 members of Shell’s UK scheme – which include 29,000 ex-employees receiving pensions – were told in a report from the trustees that the company suspended contributions from July 1. The trustees also said that a large amount of investments had been switched from equities into bonds in the second quarter of this year, ahead of the recent turmoil in the markets. The weighting in equities has been cut from 74pc to 50pc, with most of the money going into bonds, which had previously accounted for about 13pc of the scheme.
Shell, which contributed £67m to the fund last year, would not disclose the scheme’s surplus, although it is thought to be about £2.9bn. The company’s Dutch and US pension funds are unaffected.
A Shell statement yesterday said: ” The Shell UK pension fund has agreed to a reduction in contributions to zero. This will be kept under review. The fund remains in a very strong position and is heavily in surplus.”
A report from Aon Consulting estimates that the largest 200 UK company pension funds showed a total surplus of £5bn at the end of September, against a deficit of £10bn at the end of August.
Changes to pensions regulations have made it harder to take contribution holidays unless schemes are showing a healthy surplus.
However, John Ralfe, a pensions consultant, said that trustees were unilaterally taking a “tougher line” following the furore in recent years over deficits and the collapse of some company schemes. He said that it was clear that Shell’s scheme was one of the healthiest in the UK, but he would like to know more details about the funding “comfort zone” and the company’s longevity assumptions about how long employees might live on average.
“There’s an argument that, if a company has a significant surplus, it should get an insurance company to buy out the liabilities. That is, buy an annuity and lock in the money,” he said.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/10/02/cnshell102.xml
This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.
Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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A head-cut image of Alfred Donovan (now deceased) appears courtesy of The Wall Street Journal.
