News

The Trustee of the Coats UK Pension Scheme (“the Scheme”) is committed to ensuring the long-term security of the Scheme.

We are pleased to announce that we’ve taken an important step to improve the security of members’ Scheme pension benefits.

We’ve chosen to enter into an agreement with Pension Insurance Corporation (“PIC”) to buy an insurance policy, called a ‘buy-in policy’. This involves securing the benefits payable to members and their dependants for the long term.

The Trustee previously purchased a similar policy with Aviva in 2022. Together with the policy from PIC, the Trustee has now secured the benefits of all members.

The Trustee has worked closely with Coats (“the Company”) throughout this process and the Company has provided the Trustee with approximately £100m of special funding to enable this transaction to take place.

There are no changes to the Scheme benefit entitlements as a result of this transaction. The Scheme will continue to be managed by the Trustee and administered by the Coats Pensions team. The Company will continue to be Principal Employer in support of the Scheme.

A letter is being sent to all CUKPS members giving more information about this transaction. We ask all our members to look out for this letter.

Members do not need to do anything in response to this letter.

P60s for the year ended 5 April 2024 have been issued to members in receipt of a pension.

An effect of the increase to the State Pension from 6 April is that more income tax is being deducted from the pensions paid by Coats Pensions Office. It is unlikely that we will be able to assist you with any questions about your income tax deduction; instead, please call HMRC on 0300 200 3300.

In Issue 6 of The Link newsletter, we updated our members on the Scheme funding position, and on the mechanism to vary the cash contributions made by the Coats Group plc (“Coats”) to Coats UK Pension Scheme (“the Scheme”).

As outlined in The Link, Coats can switch off its monthly contributions to the Scheme if the Scheme reaches over 100% funding (on the technical provisions basis) and is in surplus.

The Trustee of the Scheme has reached agreement with Coats which will enable contributions to be switched off from 1 January 2024.

Coats has agreed to pay the Scheme a one-off lump sum payment of £10 million, which is expected to move it into a surplus position. This means that from 1 January 2024, cash contributions made by Coats to the Scheme will be switched off.

This puts the Scheme in a fully funded position, which is good news for all members, and helps Coats to free up cashflow to enable additional growth opportunities.

Coats will resume paying monthly contributions on a pre-agreed basis if the funding drops to below 99% on the technical provisions basis.

Issue 6 of the Coats UK Pension Scheme newsletter – The Link – is now available. In this issue: Scheme Report and Accounts, Pensioner Paydates, Pensions in the News, and much more. An Annual Funding Statement, showing the funding position of the Scheme as at 31 March 2023, is also available.

You can view these documents online in the members-only section of this website (you will need the secure area password): click here.

The link to the Annual Funding Statement is in the Factsheets area of this section.

As part of the annual Coats UK Pension Scheme Report and Accounts, the Trustee produces a statement for members about the governance in place for members with money purchase benefits (such as Additional Voluntary Contributions).

We are pleased to confirm that this statement for the year ended 31 March 2023 is now available to view here.