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Nilgosc


Scheme Administration - Actuarial Valuation

The next actuarial valuation is due as at 31 March 2019.

The Scheme’s actuary, Aon Hewitt, carried out an actuarial valuation of the Scheme as at 31 March 2016. The results were provided in the valuation report but are briefly summarised below.

The funding level has increased from 91% at the previous valuation at 31 March 2013 to 96% at this valuation. This resulted in the deficit decreasing to £262.6m.

The average employer contribution rate that would be required to achieve full funding in 20 years, based on this triennial valuation is 21% of pay. This contribution rate is known as the common contribution rate and comprises the anticipated cost of new benefits being earned by members in the future plus the additional contributions required to repay the deficit over a 20 year period.

The common contribution rate is a theoretical average figure across the whole fund. An adjustment to the common rate has been determined for each employer in line with the Funding Strategy Statement.

A new approach to collecting deficit recovery contributions rates from employers was implemented as part of the 2016 valuation and from 1 April 2017 employer contributions consist of two separate elements:

1.    A percentage of pensionable pay in respect of future accrual of benefits

2.    Annual monetary amounts in respect of deficit recovery

The majority of employers will be paying the following minimum contribution rates for the relevant three year period plus an additional deficit recovery contribution.

 

Year

Employer Contribution Rate

1 April 2017 - 31 March 2018

18%

1 April 2018 - 31 March 2019

19%

1 April 2019 - 31 March 2020

20%