Pension scheme 'Butch' Stewart's crowning moment in ATL's 50 years

'No retiree should have to scrounge around for a living'

BY DESMOND ALLEN
Executive editor – special assignment
allend@jamaicaobserver.com

Sunday, June 17, 2018

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In the 50 years since Gordon “Butch” Stewart launched Appliance Traders Limited (ATL), no other of his many impressive achievements has brought him more joy and pride than the highly successful ATL Group Pension Scheme.

ATL on June 1 kicked off year-long celebrations of the 50th anniversary of the company that, from a tiny office near Cross Roads, Kingston, has spawned several iconic brands — Sandals Resorts, the Jamaica Observer, and ATL Automotive, among them.

“Of course I am emotional about the pension scheme,” Stewart easily admits in an interview with the Sunday Observer. “It's one of my most proud and personal achievements, because it is for the benefit of the thousands of people who have participated in the creation, growth and development of this hugely successful business,” he says.

After seeing off the pension fund to a great start, Stewart also launched a health scheme for employees in what he regarded as a companion plan to ensure his staff could afford health care.

The pension fund, which started in 1983, now serves over 4,000 employees of the ATL/Sandals Group of Companies, with assets of $20.2 billion and growing at an annual rate of 20 per cent over the past three years.

Executive chairman of the fund, Keith Collister, who is also chairman of its investment committee, noted that the size of the fund had more than doubled from the $8.8 billion based on 2013 figures.

“The annual 20 per cent growth, on a net basis, in the investment performance is unusual, and we are clearly proud of that,” adds Collister.

The 35-year-old pension scheme might not have been had Stewart not been so stubborn and determined to have his way. First he tried to get a scheme going in 1976, but the company, not yet the conglomerate of today, lacked the administrative capacity to sustain a stable fund.

But, although Stewart knew very little about the technical workings of a pension fund at that time, his concern, especially for the well-being of those who had retired, never waned. When he tried again in 1983, the naysayers told him it was bigger than him and he should just get an insurance company to handle that for him.

“The company was still fledgling, yes, but I wanted to create a fund that was available to every single employee of ATL, Caribrake at the time, and Sandals Resorts, which had come on only two years before and was not yet making money,” Stewart explains.

“Through the years, the fund has had its ups and downs, but I'm glad I never listened to those people who were telling me that we could not sustain a proper pension scheme. My firm conviction from then was that no one who works for the company and retires should have to scrounge around for a living,” he says with obvious feelings.

Stewart has watched with unmasked glee as the fund grew to become the largest private pension scheme in Jamaica, “now not only providing for the security of the future, but affording a pension for all employees of the ATL group”.

The ATL Group Pension Fund, regarded in the sector as a model scheme, is described as a “Defined Contribution” scheme, providing retirement benefits based on the funds credited to members' accounts.

It matches the employees' compulsory contribution of five per cent of salaries. That contribution, including the portion made by the company on the employees' behalf, is paid over by the respective company to the ATL Group Pension Trustees Nominee Limited every month and then invested with the aim of maximising the returns on that investment over the long term.

Every three years, the fund's surplus is divided among the members to ensure growing value. It has also become a major contributor to financing business in Jamaica, as its banking side grows increasingly potent.

The full import of the ATL Group Pension Scheme is better understood in the context of what is happening in the broader hotel sector. Of the more than 80,000 employees in the sector, only 6,100 contribute to pension schemes that are registered with and monitored by the watchdog Financial Services Commission.

Sandals accounts for the bulk of that number, Stewart noted, expressing sadness that at the current pace, over 80 per cent of workers in a sector that is Jamaica's single largest foreign exchange earner would retire with no pension arrangement in place.

“We will continue to do everything we can to ensure that the ATL Pension Scheme and health fund continue to provide increasing benefits to our valued retirees,” Stewart pledged. “That is my unwavering commitment.”

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