We’ve provided plain English explanations for some of the technical words we need to use when describing Scheme benefits. These explanations are not as detailed as the definitions provided under the Scheme Rules. If you would like full definitions, members can request a copy of the Scheme Rules from the Pensions Administration Team.



A pensions professional who estimates the long-term cost of providing pensions and advises on any contributions needed to fund a pension scheme, taking into account inflation, interest rates, how long people live and other factors.

Added Years Additional Voluntary Contributions (AYAVCs)

AYAVCs worked by using extra contributions you paid to buy additional years of service in the Scheme. These additional years were added to the actual years you completed and are included in the calculation of the pension you have in the Scheme. The benefits from these AVCs will be automatically paid as part of your pension.

Additional State Pension (also know as S2P or SERPS)

This was paid on top of the Basic State Pension under the old State Pension system, which was replaced on 6 April 2016. It was based on an individual’s earnings between limits set by the Government each year.

Additional Voluntary Contributions (AVCs)

Additional Voluntary Contributions were additional contributions that you may have chosen to pay into the M&S AVC Scheme while you were an active member of the Scheme. Your AVC savings pot can be used to provide additional income when you retire.

Annual Allowance (AA)

The Annual Allowance is the maximum amount that can be paid or built up in a pension arrangement in any tax year before an additional tax charge is payable.


The amount of money set aside in the Scheme’s fund across different types of investments.


Basic State Pension (BSP)

The pension paid at State Pension age under the old arrangement to a single person who has paid enough National Insurance contributions during their working life. For the purposes of the State Pension deduction, the BSP payable is taken as the amount over the last 12 months before you leave service, retire or die (whichever occurs first).


Capital value

The total value of your pension benefits. In a defined contribution scheme, it is simply the value of your savings pot. In a defined benefit scheme, it’s the annual pension you are due to receive at retirement multiplied by 20.

Corporate Trustee

A company that acts as the Trustee for a pension scheme and has a legal duty to safeguard members’ benefits. The Marks and Spencer Pension Trust Limited is the Corporate Trustee for the M&S Pension Scheme. It has a Board of Directors.


An employer’s legal obligation and financial ability to support its defined benefit (DB) scheme now and in the future.



In the Scheme's financial health check (known as an actuarial valuation), a deficit means it’s estimated that the amount of money the Scheme has invested is less than the money needed to pay all future pensions when they fall due.

Deferred member

Either an employee or former employee of M&S who has not yet taken their pension from the M&S Pension Scheme.

Defined benefit (DB)

A type of pension scheme where you’ve earned a pension payable for life, based on how long you were in the scheme, your pensionable salary and the pension scheme’s accrual rate. The M&S Pension Scheme is a DB scheme.

Defined contribution (DC)

A type of pension scheme where you pay contributions from your salary to an individual pension savings pot. How much you get depends on how much is paid in and how your investments perform. There are a number of ways you can access savings in a DC scheme. The M&S AVC Scheme is a DC scheme.


This is someone who, at the discretion and judgement of the Trustee, is wholly financially dependent on a member under the terms set out in the Scheme Rules.


Fiduciary duty

The legal obligation on the Trustee to act in the best interests of the Schemes’ members and their beneficiaries.

Funding level

The difference between the Scheme’s assets and its liabilities, which can be provided as an amount or a percentage.


Greenhouse gas emissions

Any gas that has the property of absorbing heat energy emitted from the earth’s surface and radiating it back to the earth’s surface, contributing to the greenhouse effect.

Guaranteed Minimum Pension (GMP)

This is the minimum pension a DB pension scheme that contracted out of the Additional State Pension must provide. It only applies for service before 6 April 1997. Members with service before 6 April 1997 will have two parts to their pension: the GMP and the Scheme pension (what’s left of the total pension after taking out the GMP).



HM Revenue & Customs - responsible for the registration of pension schemes and the taxation of contributions and benefits.



The amount the Scheme would need today to be able to pay all members’ pensions as they become due for payment, based on a range of assumptions, including life expectancy and future investment returns.

Lifetime Allowance (LTA)

The Lifetime Allowance is the maximum value of pension benefits (excluding any State Pension) which you can receive before you have to pay a tax charge.


Net zero

When the amount of greenhouse gases added to the atmosphere is equal to the amount taken out.

Nomination form

A form used to let the Trustee know who you would like to nominate for any lump sum benefits in the event of your death.

Normal Retirement Date (NRD)

This is the last day of the month following your 65th birthday. If you joined the Scheme on or before 31 December 1995, you may be able to take your full pension from the last day of the month following your 60th birthday.


Pensionable service

The service that was used to calculate your pension. It also determines how your pension increases. It is the number of years and days of continuous service you completed whilst you were building up benefits as an active member of the Scheme. It is rounded to the nearest month if you had an incomplete month of service.

Preserved pension

Pension you have built up in the Scheme but not yet started receiving. It is payable from your Normal Retirement Date.


Retired member

A member of the Scheme who has started to receive their pension.



The M&S Pension Scheme, legally known as The Marks and Spencer Pension Scheme.

Scheme Rules

A legally binding document detailing the pension benefits which must be provided to members of a pension scheme.

State Earnings Related Pension Scheme (SERPS)

The Additional State Pension scheme that ran from 6 April 1978 to 5 April 2002. It was replaced by the State Second Pension (S2P) on 6 April 2002.

State Pension deduction

An amount that is deducted from your pension in line with the Scheme Rules. We’ve provided a detailed explanation here


In the Scheme's financial health check (known as an actuarial valuation), a surplus means it’s estimated that the amount of money the Scheme has invested is more than the money needed to pay all future pensions when they fall due.


Transfer value

This is the cash amount the Scheme will pay if you leave the Scheme and transfer the value of your benefits to your new employer’s pension scheme, or personal pension arrangement. The new arrangement must be a recognised scheme under HMRC requirements.


The Trustee is a Board of Directors who are responsible for running the Scheme under the Corporate Trustee. They have a legal duty to safeguard the benefits you have earned.


Value-at-Risk (VaR)

A measure used to assess the financial risk of an event to a company or investment portfolio.