Germany-based aircraft manufacturer Airbus Deutschland has appointed Invesco Asset Management to administer and manage Lebensarbeitszeit-Konten or working-life accounts for its 18,000 employees.
Hamburg-based Airbus is the third large German corporation to opt for the working life-accounts after Deutsche Bank and Volkswagen, but the first to outsource the administration as well as the management of these funds to an asset manager.
Christof Quering, head of pension management at Invesco, comments:“The Lebensarbeitszeit-Konten is a pension vehicle for the pre-pension period, which is a time when workers are still employed at the company but stay at home and receive money from us.”
The working–life account, Quering explains, is one of the new solutions put forward by the German government to cope with a fast ageing population by allowing workers to fund pre-pension packages.
Rather than having overtime paid with their wages, workers save the extra income for the time they are eligible for pre-retirement. It is an arrangement expected to generate about E15m a year.
The working-life accounts can be invested in a number of different fund types.
One, known as ‘life-cycle’ is split in two age-based vehicles. Younger workers’ funds are generally invested in global equities with a technical asset allocation component, that means Invesco can manage the asset quota to a certain extent, Quering notes.
Older workers are able to follow a more conservative line by investing in a fund called Capital Shield Fund where 90% of the fund’s value is guaranteed.
“With increasing age, the proportion of securer assets is increased. Later on it may be possible for workers to put aside part of their wages too, but for the time being it is just overtime contributions,” adds Quering.
He says a similar investment programme has also been put in place for camera producer Leica Microsystems.