31. PENSION SCHEMES (continued) Local Government Pension Scheme(continued) Financial Reporting Standard 102 (FRS 102)


The following information is based upon a full actuarial valuation of the Fund at 31 March 2019 updated to 31 July 2021 by a qualified independent actuary, using financial assumptions in accordance with the requirements of FRS 102.


Basis for estimating assets and liabilities


The liabilities have been assessed using the projected unit method, an estimate of the pensions that will be payable in future years are dependent on the following major assumptions:


Longevity assumptions:


Mortality Life expectancy is based on the Fund’s VitaCurves with improvements in line with the CMI 2020 model, with a 0% weighting of 2020 data, standard smoothing (Sk7), initial adjustment of 0.5% and a long term rate of improvement of 1.5% per annum for women and men.


Based on these assumptions the average future life expectancies assuming retirement at age 65 (years) are:


At 31 July 2021


Current pensioners (retiring today) Males Females Future pensioners (retiring in 20 years)* *Figures assume members aged 45 as at the last formal valuation date (31 March 2019).


Historic mortality Life expectancy for the prior period end are based on the fund’s VitaCurves. The allowance for future life expectancies are shown below:


Period ended 31 July 2021


Prospective Pensioners


CMI 2018 model assuming the current rate of improvements has peaked and will converge to a long term rate of 1.25% p.a.


Pensioners


CMI 2018 model assuming the current rate of improvements has peaked and will converge to a long term rate of 1.25% p.a.


The mortality assumptions used to value the obligations in the University’s closing position are different to those used to value the obligations in the University’s opening position.


Commutation


An allowance is included for future retirements to elect to take 50% of the maximum additional tax-free cash up to HMRC limits for pre-April 2008 service and 75% of the maximum tax-free cash for post-April 2008 service.


Males Females


21.9 24.4


23.3 26.4


At 31 July 2020


21.7 24.0


22.9 25.7


139


Financial Statements 2020/21


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