As you are aware, the Personal Lifestyle Strategy (PLS) is our innovative pension investment solution for members of our pension schemes. PLS is designed to meet two very important needs for pension scheme savers as it helps protect a member’s pension fund value against market fluctuations as retirement approaches and it also directs a member’s investment into appropriate funds that best match the benefits they are likely to take on their retirement.
Another key advantage of PLS is that we are committed to ensuring that PLS stays up to date and relevant. We review the strategy regularly, meaning that it automatically changes over time to take account of changes in retirement regulations and investment opportunities. When changes are made, all existing members invested in PLS benefit from the changes as well as new members entering PLS.
Last year, we analysed the investment approach used during the ‘growth phase’ of the strategy. Our goal in this analysis was to reduce the potential volatility of the growth phase whilst continuing to focus on growth potential. In order to achieve this goal, we introduced a new fund called Consensus Plus, a fund predominantly invested in the same way as the Consensus Fund but with assets added to give greater investment diversity and a broader geographic spread of investments.
This year, following further analysis of the fund, we have decided to increase the allocation in assets which improve the investment diversity and the geographic spread of the fund, without significantly changing the asset allocation in terms of the percentage of the fund invested in equities, bonds, etc. We believe this change will help further reduce the potential volatility of the fund whilst maintaining a strong focus on the growth potential of the fund. We will make this change to the fund allocation in August, 2014.
The changes to the Consensus Plus fund are summarised in the table below:
| Current Consensus Plus Fund | Future Consensus Plus Fund |
| Consensus Fund | 90.0% | 80.0% |
| Commodities | 0.4% | 0.0% |
| Emerging Market Debt | 0.3% | 0.8% |
| Euro Corporate Bonds | 1.1% | 2.9% |
| Emerging Market Equity | 1.9% | 5.0% |
| Pacific Excl Japan | 0.4% | 1.1% |
| Japan | 0.2% | 0.5% |
| Global Inv Grade Bonds | 1.3% | 3.4% |
| Global Inflation Linked Bonds | 0.4% | 1.1% |
| Global High Yield | 0.5% | 0.5% |
| UK Equity | 0.5% | 1.3% |
| Small Cap | 3.0% | 3.0% |
| Irish Property | N/A | 0.4% |
Source: Irish Life Investment Managers
Fund management charges and liquidity are key considerations for pension investors. We are pleased to confirm that there is no increase in the fund management charge as a result of these changes, and that the liquidity of funds during the growth phase is as before.
