Principal actuarial assumptions


Valuation at 31 March 2011


Rate of increase in salaries (excluding promotional scale) Rate of increase to pensions in payment Rate used to discount scheme liabilities Rate of future price inflation (RPI) Rate of future price inflation (CPI) Expected return on scheme assets Rate of deferred revaluations


4.1% 3.5% 5.6% 3.6% 3.1% 6.2% 3.1%


2010


4.3% 3.7% 5.7% 3.8% –


6.4% 3.8%


The demographic assumptions have been taken to be the same as those adopted for the last actuarial funding valuation. The post-retirement mortality assumption uses the ‘92 series’ standard mortality tables with Medium Cohort improvements and underpins of 1% per annum. The life expectancies used to determine benefit obligations are:


31 March 2011 Male


Member aged 65 (current life expectancy) Member aged 45 (life expectancy at 65)


Analysis of movements in the SOFA


2011 £000


Current service cost Interest cost on scheme liabilities


Expected return on assets in the scheme Past service cost


Net finance charge Total pension cost recognised in the SOFA


Actual return less expected return on pension scheme assets Experience gain/(loss) on liabilities


Changes in assumptions underlying the present value of liabilities Gain on change in future revaluation assumption to CPI


Actuarial gains/(losses) recognised in the SOFA (8,892)


(20,624) 19,413 (197)


(1,408)


(10,300) 5,462 5,840


6 2,349 13,657


2010 £000


(6,642)


(17,088) 14,919


(406) (2,575)


(9,217) 57,338


(13,464) (78,783) –


(34,909)


The cumulative amount of actuarial gains and losses recognised in the SOFA since 1 April 2004 is a loss of £0.9 million (2010: £14.5 million loss). The actual return on scheme assets for the year was a gain of £24.9 million (2010: £72.3 million gain).


22.7 24.5


Female 25.8


27.8


31 March 2010 Male


22.6 24.4


Female


25.7 27.8


Annual Report and Accounts / Notes to the Accounts / 55


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