The 31 March 2021 actuarial valuation was completed in early 2022. The headline result from the valuation was that the Scheme was in good financial health. The BCSSS Rules state that, should the funding level at an actuarial valuation fall outside a specified range, the Trustees and the Guarantor should consult. The purpose of this consultation is to understand whether it is appropriate for new funds to be sought from the Guarantor or for funds to be paid to the Guarantor. The strong funding position at the 2021 valuation led to such a consultation being triggered. This consultation commenced once the valuation was completed in early 2022.
As part of this consultation, the Trustees asked the Guarantor to consider whether there were ways to take advantage of the strong funding position to provide additional benefits to members and payments to the Guarantor. Any changes of this nature would have fallen outside the provisions in the Scheme Rules, so would require the Guarantor to agree to them.
The consultation has now been completed. The Guarantor did not feel it was appropriate to make changes to the Scheme, having considered the risk to the Guarantor if future investment returns fell short of those required.
The Guarantor reiterated its commitment to ensuring the security of the Scheme via the Government Guarantee. Under the Guarantee, members’ pensions are protected and will always be paid. Furthermore, the guaranteed part of members’ pensions increases in line each year with RPI. This meant that in January 2023 members received a 14% increase to their guaranteed pension.
The next actuarial valuation is due as at 31 March 2024 and the funding position of the Scheme will be formally assessed again at that time. The Trustees look forward to engaging with the Guarantor again as part of that process.