Mobile navigation

Reflecting on our investment performance and funding position

Valuation Graph

05 May 2022

We are currently in the middle of the work for our 2022 actuarial valuation.  This piece of work takes place once every three years.  It values the scheme, and sets out how we will fund the scheme going forward. 

As a funded scheme, i.e. one which holds investment assets, we are able to fund the pension payments through a mixture of investment returns, and contributions from our members and employers.  The rate which the members pay is set out in legislation, so only the employers' rate can be changed through the actuarial valuation process. 

The valuation shows us the value of our liabilities (i.e. the present value of the pension benefits which we will have to pay out in the future).  We can compare this to the value of our investment assets to assess the funding level of the scheme.

The following chart shows our longer-term funding situation.  The blue line represents the value of our assets, from 2006 to the present day, and the orange dots show the present value of the liabilities.  Dots above the line represent a funding deficit, dots below the line represent a funding surplus.

This chart shows that in the most recent couple of years, the line has moved up above the dots, as strong investment performance has overtaken the liabilities, putting the Fund in a healthy funding position!

This next chart shows in more detail how the Fund's investments have performed over the last 3 years, since the 2019 actuarial valuation.  Significant events have been highlighted on the chart.  As part of each actuarial valuation, we set an expected investment return - in the 2019 valuation this was set at 3.8% per annum, and this is illustrated by the purple line.

This shows that over the last three years, in spite of unprecedented global events and some significant ups and downs, the Fund's investments have grown by around £315m more than expected! This puts us in a good position moving into the 2022 valuation.  We look forward to sharing the results in due course.



Share this page

Facebook icon Twitter icon email icon


print icon