TRUSTEE MEMBERS
FOR
NATIONAL EMPLOYMENT SAVINGS TRUST CORPORATION
Information Pack
SEPTEMBER 2014
Contents
Overview
Introduction
NEST Corporation
The NEST Trustee Board
Person specification: skills, experience and abilities
Training and legal requirements of a Trustee
Other information
Diversity and Equality
Terms of Appointment
Standards in public life, political activity and conflicts of interest
Trustee Indemnity
How to apply
Selection and Recruitment Process
Application Eligibility
Complaints Process
Annex 1Public Body Code of Conduct
Annex 2 Conflicts of Interest
Annex 3 Advert
Overview
TheSecretary of State for Work and Pensions is looking to appoint high calibre
individuals to fill Trustee Member posts for NEST Corporation. The appointments will be made by the Secretaryof State under the provisions of the Pensions Act 2008, Schedule 1, Part 1,paragraph 1.
These appointments are regulated by the Commissioner for Public
Appointments and the appointments process will follow the Commissioner’s
Code of Practice and Cabinet Office guidance. Appointments are made on the
basis of merit and will ensure the Board as a whole contains the right balance of
experience, knowledge and expertise and reflects diversity.
This document sets out the requirements for the role of a Trustee Member of
NEST Corporation and the process for applying.
Introduction
The UK is facing a significant challenge to providing income and security in retirement. Without action, this would increase pensioner poverty or place unsustainable pressure on the state or both.
Automatic enrolment is a flagship Government policy, designed to address this challenge. It requires employers to enrol their eligible workers into a workplace pension scheme and - using the behavioural economics of inertia - requires workers to actively decide to opt out of pension saving. Employers and workers must make minimum contributions which are currently 2% on a band of qualifying earnings (between £5,772 and £41,865 in 2014/15) with at least 1% from the employer. From October 2017 total minimum contributions will rise to 5% and from October 2018 to 8%.
Around 1.3 million employers will be affected and almost all will be small and medium sized employers who have fewer than 250 workers. In addition, around 10 million people will be eligible for automatic enrolment, with 6 to 9 million people newly saving or saving more, generating £11 billion a year in pension saving.
NEST Corporation
The National Employment Savings Trust (NEST) was establishedby Governmentin 2010 to underpin automatic enrolment. It has been designed to provide a quality, low-cost pension scheme focused ona target market of low to moderate earners and smaller employers. The market operated inefficiently for this target group, either being unwilling to supply due to profitability, or only able to do so with high charge levels.
NEST has a public service obligation to admit any worker automatically enrolled by their employer, even if the cost of administering the account is greater than the revenue derived from charges. NEST has been operating since 2011 and has;over 1.5 million scheme members;around £200million assets under management; and about9,000 participating employers. It is expected to grow rapidly in membership and funds under management over the next few years.
NEST is a trust-based, occupational pension scheme and NEST Corporation is the sole corporate Trustee of the scheme. Legislation sets out the functions of NEST Corporation and makes provision for the scheme’s administration and management. NEST Corporation has the status of a Non-Departmental Public Body, in which capacity the Trustee Board is accountable to Parliament for the effective performance of its statutory functions
Until the income streams are established, the set up costs and early years running costs are being funded by a Government loan. NEST Corporation receives relief on the interest payable through the provision of State aid. The public service obligation is the foundation of the Service of General Economic Interest for which NEST receives State aid.
The NEST Trustee Board
The Board is entirely comprised ofTrustee Members, including a Chair and Deputy Chair. There are a minimum of 9 and a maximum of 15 Trustee Members of NEST Corporation who are collectively responsible for running the scheme and setting the strategic direction and objectives for the scheme and the organisation that supports it.
The Board’s key responsibilities are to:
- ensure NEST is a quality, low-cost pension scheme that maintains a trusted public profile and successfully supports automatic enrolment
- ensure the governance of NEST as a trust-based, occupational pension scheme is strong and satisfies regulatory obligations
- understand and reflect the needs and requirements of scheme members
- ensure NEST Corporation fully meets the requirements of being a Non-Departmental Public Body
- shape the strategic direction and operational policy for NEST and NEST Corporation
This document sets out the requirements for the role of the Trustee Members for NEST Corporation and the process for applying.
Person specification: skills, experience and abilities
Each Trustee Member is expected to productively contribute to Board debates and decision making. They are also required to apply their skills and experience to one or more of the Board’s Committees – Audit, Determinations, Investment, Nominations and Governance, Remuneration, and Risk. The time commitment for each Trustee Member is 30 days per annum and the appointment period will be for a period of up to five years.
The successful candidates will have a track record of achievement at board or senior executive level. Candidates for these posts must have detailed skills and experience in at least one of the following areas: investment/fund management; pensions; transformational change of a complex organisation; or commercial management of a large e-enabled business.
The core competencies required are:
- Communicating and collaborating - a team player, with excellent communication skills, able to collaboratively develop a strong direction and culture for the organisation
- Making effective decisions - ability to analyse complex strategic issues that cut across all aspects of the business
- Setting direction - an understanding of the public sector context in which NEST operates, able to prioritise and maximise strategic outcomes with a focus on value for money
- Delivering results - ability to identify economic, market and customer issues, using these to promote innovative business models and commercial agreements that deliver greatest value
Knowledge or experience of contract & supply chain management or consumer engagementthrough e-business delivery would be desirable.
Training and legal requirements of a Trustee
All Trustee Members of NEST Corporation including the Chair must ensure that they appreciate, and satisfy, the legal requirements to have sufficient knowledge and understanding of relevant issues, and to be conversant with scheme documents, as required by the Pensions Act 2004.
Trustees must, in accordance with the Pensions Act 2004, ensure that they have knowledge and understanding of:
- the law relating to pensions and trusts
- the principles relating to the funding of pension schemes
- the principles relating to investment of scheme assets
- any other matters as required by the Pensions Regulator (see in particular the Code of Practice on trustee knowledge and understanding, and associated scope documents)
The degree of knowledge and understanding required is that appropriate for Trusteesto properly exercise their functions as the corporate trustee of NEST. Greater knowledge and understanding in particular areas is likely to be required for members of specialist committees (for example, investment committees) and for the Chair.
Other information
It is strongly recommended that candidates read the following documents:
- Detailed Guidance for Trustees is available on the Pension Regulator’s website
- HMRC Guidance on the fit and proper person criteria for pension scheme administrators
- The Code of Conduct for Board Members of Public Bodies
- The NEST website provides information on NEST's development and governance
- The GOV.UK website provides background on the Government’s workplace pension reforms
Diversity and Equality
The Department for Work and Pensions is committed to providing services which embrace diversity and which promote equality of opportunity. We welcome applications from all candidates. We particularly welcome applications from women, those with a disability and those from a black or an ethnic minority background, and those who have not previously held a public appointment.
Terms of Appointment
- The appointment will be for a term of up to five years.Reappointment for one further term is possible but will be the exception rather than the rule
- The time commitment required will be30 days per annum.Some UKtravel and evening commitments may be required
- Remuneration for the post will be £19,050 per annumbased on30days a year (£635 a day). Any agreed additional days will depend on availability and will be payable on a pro rata basis.
- NEST Corporation is based in London. Trustee Member meetings are generally held there, but some UK travel may be involved
- Reasonable travel expenses and subsistence relating to official business will be reimbursed
- The successful candidate will be expected to attend familiarisation, orientationactivities and any further training that is considered necessary
- Permission must be obtained from the Secretary of State to undertake any other work, accept any other appointments, or engage in any activity which might create a conflict of interest with the role
- Detailed performance and accountability processes and objectives will be agreed between the Chair of NEST Corporation and the Trustee Members at least once a year
Standards in public life, political activity and conflicts of interest
Standards in public life
Candidates must also confirm that they understand the standards of probity required of public appointees outlined in the ‘Seven Principles of Public Life’ drawn up by the Committee on Standards in Public Life (see Annex 1).
Conflicts of interest
Applicants, in their application, must disclose information on personal connections, which if they were appointed, could lead to a conflict of interest or be perceived as such.
It is very important therefore that all applicants provide appropriate details of any interests, which might be construed as being in conflict with the appointment for which they are applying. If it appears, from the information provided on the form, that a possible conflict might exist, or arise in the future, this will be fully explored with the applicant with a view to establishing whether it is sufficiently significant to prevent the individual from carrying out the duties of the post. The panel will do this at interview stage.
Annex 2 provides information on conflicts to help applicants evaluate whether or not they have a potential conflict.
Trustee Indemnity
In common with many trust-based occupational pension schemes, potential Trustee Members of NEST Corporation will want to be assured that adequate exoneration and indemnity arrangements are in place to protect them. The NEST Order (Statutory Instrument 2010/917)[1]contains provisions that exonerate and indemnify the trustee and those to whom it delegates responsibility from liability for losses arising from their actions in running the NEST Pension Scheme.
There are some exemptions to this indemnity, for example where actions are wilful or dishonest, where the Pensions Regulator has imposed civil penalties and where investment duties have not been complied with. There is also some standard indemnity cover for NDPBs, but this does not extend to the fiduciary duties of trustees.
How to apply
The Department for Work and Pensions is working with Hays Executive on this appointment. The process is one of fair and open competition, in keeping with the Commissioner for Public Appointments'Code of Practice for Ministerial Appointments to Public Bodies.
In order for us to progress your application please submit the following completed documentation:
- A Curriculum Vitae with your education and professional qualifications and full employment history
- An accompanying Supporting Letter (maximum 2 A4 pages) – setting out your suitability for the role and how you meet the essential and desirable skills set out in the person specification - please ensure your full name and the corresponding reference number for the post are clearly noted at the top of your application
- Equal opportunities monitoring form - this form will not be disclosed to anyone involved in assessing your application
- Political activity form
- Conflicts of interest declaration
Sections 3,4 and 5 are enclosed in a separate Monitoring Forms document.
Email applications are encouraged.
The closing date for applications is 20 October2014 at 1800hrs
Applications should be sent as follows:
By email to:
or by post to:
Andrew Timlin
Hays Executive
23 Lower Belgrave Road
London
SW1W ONT
All applications will be acknowledged – if you have not received an acknowledgement within five working days please contact Andrew Timlin.
To discuss the appointments, please contact:
Andrew Timlin or Jayne Macleod on 0207 259 8743, ;
Expenses
Reasonable travel expenses will be reimbursed to candidates who attend for interview. Applications for reimbursement should be made in writing to Andrew Timlin
Selection and Recruitment Process
All appointments are made following an open competition conducted in accordance with the Code of Practice published by the Commissioner for Public Appointments.
Short listing of candidates will be undertaken by assessing the information provided in their CV and Supporting Letter. The short listing will be undertaken by a selection panel.
Applications will be sifted on 28October 2014. At this date a shortlist of candidates will be selected for panel interview.
Successful candidates can expect to be contacted by week commencing10 November 2014.
Those who are unsuccessful at this stage will be notified in writing.
Panel interviews will take place on 25 November and on 4 December 2014. We expect to put forward recommendations to Ministers shortly after this date.
During the period following appointment the successful candidates will be
required to undertake familiarisation and orientation activities. Subject to
obtaining Ministers approval in time, the successful candidates will take
up post from1 April 2015.
These dates are accurate at the time of writing but are subject to change.
Please contact Andrew Timlin at Hays Executive if you have any limits on your availability in the time periods mentioned above.
Application Eligibility
If you are selected for appointment, we will need to carry out enquiries to ensure that you meet the criteria for appointment. This will include ensuring that you are not disqualified from acting as a trustee. We will need to see your original birth certificate or passport, as well as evidence of your educational and professional qualifications that you consider relevant to your application.
Complaints process
The Commissioner for Public Appointments regulates and monitors ministerial appointments to a number of public bodies. Government departments are required to follow the Commissioner’s Code of Practice when processing these public appointments.
The Code of Practice is based on three core principles – merit, openness and fairness – and sets out the essential requirements for meeting those principles.
The Commissioner also investigates complaints and may conduct an inquiry into the policies and practices followed in relation to appointments processes which he regulates. The Commissioner will not investigate complaints relating to non selection unless it appears that the appointments process has breached the Code of Practice.
If you feel you have reason to complain, you should direct your concerns in the first instance to Rachael McGruer at the Department for Work and Pensions, who will make every effort to deal with these and respond to you.
Email:
If, after receiving a comprehensive response you are still concerned, you can write to the Commissioner at:
The Commissioner for Public Appointments
Room G8
Ground Floor
1 Horse Guards Road
London
SW1A 2HQ
Email:
Further details on making a complaint are available from the Commissioner for Public Appointments website at:
Annex 1Pubic Body Code of Conduct
In 1995, the Committee on Standards in Public Life defined seven principles, which should underpin the actions of all who serve the public in any way. These are:
SelflessnessHolders of public office should take decisions solely in terms of the public interest. They should not do so in order to gain financial or other material benefits for themselves, their family, or other friends.
IntegrityHolders of public office should not place themselves under any financial or other obligation to outside individuals or organisations that might influence them in the performance of their official duties.
ObjectivityIn carrying out public business, including making public appointments, awarding contracts, or recommending individuals for rewards and benefits, holders of public office should make choices on merit.
AccountabilityHolders of public office are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office.
OpennessHolders of public office should be as open as possible about all the decisions and actions that they take. They should give reasons for their decisions and restrict information only when the wider public interest clearly demands.
HonestyHolders of public office have a duty to declare any private interests relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest.
LeadershipHolders of public office should promote and support these principles by leadership and example.
Annex 2 Conflicts of Interest
What is a conflict of interest?
Public Appointments require the highest standards of propriety, involving impartiality, integrity and objectivity, in relation to the stewardship of public funds and the oversight and management of all related activities. This means that any private, voluntary, charitable or political interest which might be material and relevant to the work of the body concerned should be declared.