Aviva completes £200m buy-in, securing benefits attributable to Arriva Merseyside Ltd within the Merseyside Pension Fund

Aviva has announced the completion of a £200 million bulk purchase annuity scheme buy-in with the Merseyside Pension Fund (MPF).  The transaction was completed in June 2024 and secures the benefits of c2,500 MPF members, attributable to Arriva Merseyside Ltd, in full.  

Wirral Borough Council are the Administering Authority responsible for managing and administering the Merseyside Pension Fund. Mercer were the lead advisers on the transaction with input from Paul Middleman as the Fund Actuary. Legal advice was provided to the Administering Authority by Eversheds Sutherland LLP.

In selecting an insurer, the Administering Authority placed a strong emphasis on Environmental, Social, and Governance (ESG) considerations.  Aviva was able to demonstrate its commitment, both as a founding signatory to the Sustainability Principles Charter for Bulk Purchase Annuities, and through its track record of taking action on climate change and social action, to help build stronger communities.

John Fothergill, Senior Deal Manager at Aviva, said: “We developed Aviva Clarity as a streamlined process to help a greater number of trustees by increasing standardisation.  It’s pleasing that Aviva has now been recognised for tailoring its approach to adapt to the public sector procurement process. The Administering Authority made clear upfront the requirements to meet their ESG expectations and to be trusted to provide members’ benefits. This enabled us to efficiently deliver what they needed in order to proceed with Aviva.”

Peter Wallach, Director of Pensions at Wirral Borough Council, commented: “We are delighted to have expanded our risk management strategy to achieve greater certainty of cost for the Fund’s biggest non - public sector constituent employer, Arriva Merseyside, whilst simultaneously improving governance and reducing risk across the employer base with Aviva.

“This was a complicated project, and we thank Mercer and Eversheds Sutherland for the clarity, expertise and tenacity they brought in assisting us through the process to ensure compliance with public procurement legislation, and to obtain competitive pricing along with good contractual terms. Merseyside Pension Fund has now become a Charter signatory and we look forward to working collaboratively with Aviva, Mercer and other signatories, post-transaction.”

Ian Kirk, Group Pensions Manager at Arriva Group, commented: “This is great news for members of the Merseyside Pension Fund, and we fully support Wirral MBC’s decision to de-risk with Aviva. Our number one priority across all of our pension schemes is to minimise risk and protect member benefits, and this transaction does just that"

Andrew Pugh, Risk Transfer Principal at Mercer, said: “We worked closely with the Authority and Eversheds Sutherland to create a customised broking and procurement process.  This maximised insurer engagement and helped us secure the best deal for the bulk annuity transaction. With Mercer being a supporter of the Charter, it was particularly pleasing to help the Authority meet its financial strength and sustainability objectives.”

Amanda Small, partner at Eversheds Sutherland added: “We are really pleased to have assisted the Administering Authority on the implementation of its risk management strategy. The Authority had clear objectives, and we used our combined expertise in procurement law, public sector pensions and risk transfer to help deliver them”.

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About Mercer

Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer’s approximately 25,000 employees are based in 43 countries and the firm operates in over 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people, with more than 85,000 colleagues and annual revenue of $23 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit mercer.com. 

About Arriva Group

Arriva is a leading provider of passenger transport across Europe, employing around 34,400 people and delivering around 1.6 billion passenger journeys. With buses, trains, coaches, trams, waterbuses, bike-sharing systems, on-demand transport solutions and a rolling stock leasing company, Arriva proudly connects people and communities safely, reliably and sustainably across 11 countries, delivering these services in a better way, every day. The activities of Arriva are divided into four business units: UK Bus, UK Trains, The Netherlands and Mainland Europe. Arriva has passenger transport operations in the Czech Republic, Croatia, Hungary, Italy, the Netherlands, Poland, Slovakia, Slovenia, Spain and the United Kingdom, and also operates a rolling stock leasing company in Romania.  www.arrivagroup.com

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• We are the UK’s leading diversified insurer and we operate in the UK, Ireland and Canada. We also have international investments in India and China.
• We help our 19.5 million (as at 30 June 2024) customers make the most out of life, plan for the future, and have the confidence that if things go wrong we’ll be there to put it right.
• We have been taking care of people for more than 325 years, in line with our purpose of being ‘with you today, for a better tomorrow’. In 2023, we paid £25.6 billion in claims and benefits to our customers.
• In 2021, we announced our ambition to become Net Zero by 2040, the first major insurance company in the world to do so. We are aiming to have Net Zero carbon emissions from Aviva’s operations and supply chain by 2030. While we are working towards our sustainability ambitions, we recognise that while we have control over Aviva’s operations and influence on our supply chain, when it comes to decarbonising the economy in which we operate and invest, Aviva is one part of a far larger global ecosystem. There are also limits to our ability to influence other organisations and governments. Nevertheless, we remain focused on the task and are committed to playing our part in the collective effort to enable the global transition. Find out more about our climate goals at www.aviva.com/climate-goals and our sustainability ambition and action at www.aviva.com/sustainability
• Aviva is a Living Wage, Living Pension and Living Hours employer and provides market-leading benefits for our people, including flexible working, paid carers leave and equal parental leave. Find out more at https://www.aviva.com/about-us/our-people/
• As at 30 June 2024, total Group assets under management at Aviva Group were £398 billion and our estimated Solvency II shareholder capital surplus was £8.2 billion. Our shares are listed on the London Stock Exchange and we are a member of the FTSE 100 index.
• For more details on what we do, our business and how we help our customers, visit www.aviva.com/about-us