A message from the Chair

Welcome to our annual report on the Eli Lilly Group Pension Plan (the Plan).

The Trustee Board’s focus is to make sure the Plan’s assets are enough to pay current and future benefits to you as members. You can read more about the Plan’s financials in the financial update part of this newsletter. 

In 2024, the Trustee Board undertook the following work:

  • Completing the implementation of Guaranteed Minimum Pension equalisation for all impacted Plan members.
  • Regularly updating the Plan’s website, elilillygrouppensionplan.co.uk, which aims to help you understand your pension and access key information on the Lilly Plan Portal. We regularly add articles to the news section and send an email to those members who have registered an email address.
  • Julie Osman retired from her role as Plan Secretary at the end of 2024 and we thank her for her service to the Plan. We’re pleased to confirm that Julie has since been appointed as an Employer Nominated Trustee with effect from 1 April 2025. Her knowledge of the Plan will be valued by the Board. We have successfully transitioned the secretarial and governance function to Independent Governance Group.
  • Reviewing the Plan’s governance framework against the requirements of the Pension Regulator’s General Code of Practice which was published in early 2024 and carrying out relevant actions to ensure the Plan is compliant with the regulatory standards. This included reviewing the Plan’s own cyber risk and controls.
  • Preparing for connection to the Pensions Dashboard. More will follow on this in 2026.

In this edition, we’ve included some information on how to spot and steer clear of scammers who could try and trick you into giving them your pension. We’ve also included a reminder to review your Special Employer Contributions (SpECs) and Additional Voluntary Contributions (AVCs). 

If you’d like to receive future communications digitally, please visit the Lilly Plan Portal and provide us with your email address.

You can also now use the Portal to chat with our pension administration team and raise any questions directly with them. If you can register online, we would encourage you to do so — but please be assured that we will continue to accept queries by phone and post.

Ian Dane

Please read this report carefully and if you have any feedback please contact the Administrator, Gallagher.

Ian Dane - Chair
Eli Lilly Group Pension Plan

Financial update

In this section of our Report, we summarise the key information from the Plan’s 2024 Report & Accounts . A copy of the Trustee Report & Accounts is available in Documents. 

Summary fund account

The fund account is like the Plan’s bank statement, showing our income and expenditure for the year.

Assets at 31 December 2023£1,220.5m
Contributions£6.8m
Benefits and expenses paid-£45.7m
Net return on investments-£103.6m
Assets at 31 December 2024£1,078m
Financial update decorative image

Investment allocation and performance

The Plan’s assets are invested with the aim that they provide sufficient funds to cover the Plan’s liabilities, both now and in the future. We have a Statement of Investment Principles that sets out the strategy behind our investments, and each year we publish an Implementation Statement that shows how the strategy has been put into practice. You can read both documents on the Plan website: elilillygrouppensionplan.co.uk/documents

Our assets are currently invested in a mix of Liability Driven Investments (LDIs) and illiquid assets. LDIs are designed to roughly follow the movement of the markets that affect the Plan’s anticipated liabilities, particularly inflation and interest rates and so to maintain a stable funding position. In practice this means that the majority of our investments are in UK government bonds (or gilts) and similar asset types, with some smaller holdings in asset classes such as private equity and property.

The Trustee has agreed that the illiquid assets currently held will be allowed to run down over time. The Plan does not target a fixed allocation to growth and matching assets but aims to achieve a return that helps it achieve its long-term funding target.

Throughout 2024, the value of the Plan’s assets and liabilities fell due to an increase in gilt yields. This is the reason for the negative net return on investments shown in the table.

The overall annualised return of the Plan’s investments is as follows, alongside benchmark figures for comparison:

  Performance % Benchmark %
Last year - 1 January to 31 December 2024 -8.2% -7.3%
Last three years – 1 January 2022 to 31 December 2024 -17% -17.3%
Last five years – 1 January 2020 to 31 December 2024 -6.6% -7.2%

Your Pension and the financial markets

With governments around the world imposing trade tariffs (tax on imported goods), we are seeing some uncertainty in the global financial markets. As pension schemes invest in financial markets, many see the impact on the value of their assets. 

We’d like to reassure you that the Trustee Board, along with its’ advisers, continues to monitor the Plan’s investment performance and carefully considers whether any changes are needed to the Plan’s investment strategy to support its long-term objectives.

Membership

  31 December 2024 31 December 2023
Active 231 253
Deferred  2,711 2,821
Retirees 2,709 2,679

Funding update

Every three years, the Plan Actuary (a specialist in risk and probability) carries out a full actuarial valuation of the Plan. This acts as a financial health check. The next full valuation will take place in 2026.

Financial Position at 1 January 2025

A summary of the last full actuarial valuation as at 1 January 2023 and the latest actuarial report update as 1 January 2025 are detailed below. 

All values exclude SpECs and AVCs.

 

1 January 2025

1 January 2023

Value of assets £1,038.2m £1,222.9m
Value of liabilities (cost of providing benefits already built up) £944.9m £1073.4m
Surplus  £93.3m £149.5m
Funding level  110% 114%

Note that the value of assets at 1 January 2023 reflect figures shown in the Plan’s audited accounts, while the asset values at 1 January 2025 reflect unaudited figures.

Change in the Financial Position

Over the year to 1 January 2025, there has been a small decrease in the Plan’s surplus in monetary terms, although there was still a healthy surplus of around £93m. This compares to a surplus of around £109m as at 1 January 2024. The decrease was mainly due to the returns from the Plan’s return-seeking assets being slightly lower than assumed. This was largely caused by long-term high interest rates which increased the cost of borrowing and reduced liquidity in the market. The value of the assets therefore decreased at a slightly higher rate than the value of the liabilities.

Read the full summary online

For more information, including an update on Company contributions and details of what would happen if the Plan was wound up, read the full Summary Funding Statement available the documents section.

Important reminders

Make the most of your online services

If you haven’t visited our website at elilillypensionplan.co.uk yet, we’d like to remind you of the benefits and the various online facilities that are available to you. 

On the website at elilillypensionplan.co.uk you can…

  • Find out how the Lilly Plan works
  • Get the latest Plan news
  • Learn how to use the Lilly Plan Portal
  • Read our Statement of Investment Principles or latest Summary Funding Statement
  • Get contact details for the Plan
Lilly Website

The Lilly Plan Portal is accessible from the website, or through MyReward if you’re still working for Lilly. On the portal you can...

  • See the amount of pension you may be eligible to receive
  • Review your target retirement age and estimate your total pension at different retirement ages.
  • Update your personal details
  • Complete or update your Expression of Wish form (for death benefits)
  • Request a transfer quotation
  • Chat online to a member of the Administration Team
  • Check the progress of your case if you’ve recently raised a query
  • View your pension payslips (pensioners only)                

Remember, you can view your details, including pension payslips if you’re receiving your pension, on our app, Gallagher Guide!

If you need help to access the Lilly Plan Portal or the Gallagher Guide app, please contact Gallagher, using the contact details on the back page. You could also watch the ‘How to’ videos on the Plan website, which provide a step-by-step guide to some common tasks.

Remember to review your SpECs and AVC investments

As well as building retirement benefits in the Plan, if you are an active member you can choose to make additional contributions by selecting SpECs or making AVCs. If you hold SpECs or AVC investments we recommend you check how any additional contributions are invested as you have the option to make changes should you wish. We also recommend you review your target retirement date for each fund if you’re invested in LifePath Capital. You can view your investments on the Lilly Plan Portal or myReward if you’re still working for Lilly. 

Keep your details up to date

It’s really important that you let us know if any of your personal details change, for example if you move house or change marital status. If we don’t have the correct information on file for you, we may not be able to contact you if we need to, and there could ultimately be delays or difficulties in paying your benefits.

The easiest way to update your personal details is on the Lilly Plan Portal, which you can access through our website, elilillygrouppensionplan.co.uk. If you’re still working for Lilly, you can also access the Lilly Plan Portal through MyReward.

As well as things like your name and address, you can also check that your Expression of Wish form is up to date. This tells us who you would like to receive any benefits payable from the Lilly Plan if you die while a member.

You can also update your Expression of Wish form through the Lilly Plan Portal. If you aren’t registered, you can request a hard copy form from Gallagher.

 

Plan news

Climate action update

Climate change continues to be a matter of importance for the Trustee, recognising the impact that pension schemes like ours can have through direct investment and through exercising our voting rights as shareholders in companies. We are also conscious that climate change has an economic impact and want to make sure that the Plan’s investments are safeguarded against any climate-related risks.

We issue an annual Taskforce on Climate-Related Financial Disclosure (TCFD) report and we have just published our third report, covering 2024.

In 2024, we set a new target to improve the quality of data we receive from our investment managers on climate-related matters and aimed to achieve 85% data coverage by 2029. The Trustee re-set this target having met the previous target of 61% data coverage by 2027 in 2023. In our most recent report covering 2024 we are pleased to report that data coverage is 79% which represents an increase of 12% since 2023. 

You can find a copy of the 2024 report in the document library on the Plan’s website.

Guaranteed Minimum Pensions (GMP) update

We have previously reported on the ongoing project to equalise GMPs for Plan members and ex-members with service between 1990 and 1997. This project was the result of a court ruling requiring formerly contracted-out pension schemes like ours to ensure fair and equal treatment of men and women in the calculation and payment of GMP benefits.

During 2024, the Plan implemented GMP equalisation for the remaining pensioner members and past transferees, making back payments where appropriate. If you were affected by this, we have communicated with you. 

Pensions news

Update on Normal Minimum Pension Age (NMPA)

The NMPA is the earliest age most people can start withdrawing money from their personal and workplace pensions, apart from in certain circumstances such as ill health. Currently, it is 55 years, but it will increase to 57 from 6 April 2028. If you’re in your fifties and thinking about the timing of your retirement, you should take this into consideration.

Time for your Money Midlife MOT?

Your pension savings will play a big part in your future, but we know there's more to your financial wellbeing than just saving for your retirement.

You can use MoneyHelper’s Midlife MOT tool to help you assess your current financial situation and plan for your future.

The Midlife MOT is designed for people between the ages of 45 and 65, but you can use it whenever you want.

Once you've taken your Midlife MOT, you'll get a personalised report that signposts what you could prioritise along with links to guidance on how to improve your financial wellbeing from midlife to retirement.

Take your Midlife MOT at Money Midlife MOT.

How much will you need in retirement?

Research[1] has shown that 51% of people are focused more on the short-term financial needs than long-term savings. Only 23% of people know how much they need to save for retirement.

The Retirement Living Standards

To get an idea of the income you might need when you retire, you can take a look at the Retirement Living Standards by Pensions UK (formerly known as the Pensions and Lifetime Savings Association.) The figures have recently been updated to reflect the rising cost of living and increased expectations for grandparents to help support grandchildren financially.

The three standards

Minimum

Target income:

  • £13,400 a year for a single person
  • £21,600 a year for a couple

Summary:

  • All your basic needs with some left over for fun.
  • A self-catering or half-board holiday in the UK.
  • Eating out once a month.
  • Some affordable leisure activities with family and friends once or twice a week.

Moderate

Target income:

  • £31,700 a year for a single person
  • £43,900 a year for a couple

Summary:

  • Provides more financial security and flexibility than the Minimum.
  • An annual overseas holiday and a long weekend off peak break in the UK.
  • A takeaway a week and eating out a couple of times a month.

Comfortable

Target income:

  • £43,900 a year for a single person
  • £60,600 a year for a couple

Summary:

Higher than the minimum and moderate lifestyles, and allows for more disposable income.

Includes extra luxuries such as spa days, theatre trips and holidays abroad.

Find out more

As well as reading the information on the Retirement Living Standards website, you can find clear money help and guidance that’s backed by the Government and free to use, visit the MoneyHelper website for more information. 

[1]

Retirement Living Standards

Stay safe online

Cyber fraud is unfortunately becoming more common, and scammers’ techniques more sophisticated. This is a serious issue that can have devastating consequences for individuals’ finances, including pensions. Here are some actions you can take to avoid falling foul of scammers online:

  1. Be cautious of cold calls and phishing emails. Unsolicited phone calls, emails, or messages offering pension advice or investment opportunities are often a red flag. UK legislation means that legitimate financial advisers and pension providers are not allowed to cold call you about your pension.
  2. Use strong passwords and keep them confidential. Passwords should contain a wide variety of letters, numbers and special characters. Try not to reuse passwords and don’t write them down.
  3. Turn on 2-Step Verification. Many online accounts now either offer or require 2-Step Verification (2SV). This is when you need access to a second ‘trusted’ device or account. Many UK banks have adopted this for online purchases, where as well as accurately inputting all your card details, you may need to confirm a further code which your bank will send to your second trusted device – or, if you have set up a further password specifically for online use, request that you use this to authorise the payment.
  4. Don’t visit or download from suspicious links. You could inadvertently give access to your device by downloading software or an app from a source you don’t trust. Scammers may then be able to take control of your device and access your bank account.
  5. Ensure your devices and browsers are kept up to date. As cyber scammers are always changing and developing, you need to ensure you have the latest software to guard against them.
  6. Check the Financial Conduct Authority (FCA) register. The FCA maintains a register of regulated financial services firms and individuals in the UK. Go to the FCA’s register before engaging with any financial adviser or investment firm to ensure they’re legitimate and authorised to provide financial services.
  7. Report suspected scams. If you suspect you've been targeted by a pension scam or have fallen victim to one, report it to Action Fraud.. This will help authorities prevent other people from falling victim to the scam and track fraudulent activity.
  8. Seek professional advice. Go to a registered and trusted independent financial adviser before making any decisions associated with your pension.

Cyber scams are a constant threat, and you must remain vigilant to protect your savings. By staying informed about the risks, being cautious with your personal information, and seeking advice from trusted sources, you can reduce your vulnerability and protect your financial future.

Take our quiz to find out how much you know...

  1. What is the most secure way to create a strong password?
    • Using a combination of uppercase and lowercase letters, and include numbers and special characters
    • Using personal information like birthdates or names
    • Repeating the same password for multiple accounts
  2. Which of the following is a recommended practice to protect your online accounts?
    • Enabling two-factor authentication
    • Sharing your passwords with trusted friends
    • Using public Wi-Fi networks for sensitive transactions
    • Clicking on suspicious links in emails
  3. How can you identify a secure website before entering personal information?
    • Checking for a padlock icon in the browser's address bar
    • Ignoring the website's security certificate
    • Providing personal information on any website without hesitation
    • Sharing your credit card details on any website that asks for it
  4. What is phishing?
    • A type of fishing sport
    • A method to catch online scammers
    • A fraudulent attempt to obtain sensitive information
    • A secure way to share personal data
  5. How can you protect your computer from malware and viruses?
    • Regularly updating your operating system and antivirus software
    • Downloading files from unknown sources without scanning them
    • Disabling your firewall for better internet speed
    • Clicking on pop-up ads to claim prizes

Answers: Click to show answers 1.a, 2.a, 3.a, 4.c, 5.a

Tax changes

Unused pension savings may become subject to Inheritance Tax

You may have heard about the Government’s plans, announced in the Budget last autumn, to bring certain pension benefits into scope for Inheritance Tax (IHT).

IHT is a tax on the estate (the property, money, and possessions) of someone who has died. In the past, pensions have not typically counted towards the value of a person’s estate for IHT purposes – so, for example, if you died before retiring and had defined contribution pension savings worth £100,000, that sum could be passed to your dependants without being factored into IHT calculations.

From April 2027, some inherited pensions will be included in IHT. Under the proposals, any pension payable from the Plan to your spouse or registered civil partner on your death will not be impacted. However, any unused SpECs or AVC savings you have in the Plan may become liable for IHT.

More details are still to come regarding how this will work in practice and what it will cover, for example how dependant’s pensions will be considered, but it may mean more people’s estates exceed the IHT thresholds and therefore trigger a tax payment.

Here’s a reminder of the IHT thresholds:

  • The first £325,000 of any estate can be inherited tax-free, rising to £500,000 if the estate includes a residence passed to the direct descendants, and £1 million when a tax-free allowance is passed to a surviving spouse or registered civil partner in most cases. Inheritance that exceeds these thresholds is taxed at 40%.
  • From April 2026, the first £1 million of combined business and agricultural assets will attract no IHT, but assets over £1 million will be taxed at an effective rate of 20%.

To find out more about IHT, visit gov.uk/inheritance-tax

State Pension update

For the 2025/26 tax year, the State Pension increased by 4.1%, which is the increase in earnings growth. This is part of the ‘triple lock’ system, which ensures that the State Pension rises each year by the highest of 2.5%, inflation, or earnings growth.

As a result, from 6 April 2025:

  • The full, new flat-rate State Pension (for those who reached State Pension age (SPA) after April 2016) is £230.25 a week, which is an increase of £472 a year.
  • The full, old basic State Pension (for those who reached SPA before April 2016) is £176.45 a week, which is an increase of £363 a year.

Who’s who

Trustee Board members

The current serving Trustee Directors are:

Member-Nominated

Ian Dane (Chair)

Kimberley Jackson

Swati Suri

Torkil Fredborg

Company-Appointed

Sarah Coles

Karin Hendrickse

Matthew Potter

Julie Osman

Independent Trustee

The Law Debenture Pension Trust Corporation plc represented by Edward Levy

The Secretary to the Trustee is Jake Churchill of Independent Governance Group.

Plan advisers

The Trustee Board has appointed various specialist advisers to assist with the running of the Plan.

During 2024, these were:

Actuary

Richard Gunton of WTW


Benefit Consultants

WTW


Independent Auditors

Ernst and Young LLP


Legal Adviser

CMS Cameron McKenna
Nabarro Olswang LLP
Stephenson Harwood LLP

Investment Consultants

Redington Limited


Investment Custodians

Northern Trust


Investment Platform for AVCs and SpECs

Aegon UK plc


Plan Administrator

Gallagher Pensions Administration

Useful contacts

Administration Team

Your administration team is Gallagher. 

If you have any questions about your benefits, you can contact them by:

Please note that this is a new email address following the Administrator’s change of name from Buck to Gallagher. The old email address (@buck.com) still works and forwarding arrangements are in place, but we suggest you update your records with the new address and use it going forwards.

To read general information about the Plan, go to our website, elilillygrouppensionplan.co.uk

To access the Lilly Plan Portal and view your specific information, you can go to elilillygrouppensionplan.co.uk and select “Pension portal”. If you’re still working for Lilly, you can also access the Lilly Plan Portal though MyReward.

And don’t forget our pensions app, which you can also use to view your personal details. Go to your app store and search for ‘Gallagher Guide’ to get started. The pensions app was previously known as Orion+ but had a facelift last year. Even if you’ve registered for the Lilly Plan Portal, you’ll need to set up a separate account on the app. Select ‘Don’t have an account? Register here’ to get started and enter ‘Lilly’ when asked for a client code. You’ll need the Unique ID we previously sent you, so if you don’t have it, please contact the administration team.

Other sources of information

You can get general help and advice about pensions from MoneyHelper, a free service from the Government. 

If you’ve lost touch with a pension you had in the past, the Pension Tracing Service may be able to help.