Advanced Payment Flexibility (SHAPS)

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As reported in the August 2015 Employer Update, the Committee has been considering whether employers can pay their deficit contributions - that are required to be paid in accordance with the Scheme's existing Recovery Plan - in advance of the due date.

The Committee has received advice from the Scheme Actuary on this subject and agreed, at its September 2015 meeting, the 'discount rate' (i.e. the credit given for early payment) that is to be used to calculate the advanced amount payable. The 'discount rate' is based on the long dated gilt yield at the latest valuation date and, at 30 September 2015, is 2.4%.

If an employer makes advanced payments and subsequently, either deliberately or inadvertently, triggers a statutory 'debt on withdrawal' (also known as a 's75 debt'), then the payments made in advance of the withdrawal date cannot, by law, be offset against the s75 debt. Any employers considering this option should take this into account and seek advice where appropriate.

If any employers would like to investigate this option further, please contact Susan Wardlaw, SHAPS Scheme Secretary, via email at

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