Every three years an actuarial valuation is undertaken for defined benefit (DB) pension schemes such as SHPS. This is required by legislation.
The valuation compares the assets of the scheme to the estimated cost of the benefits that have been earned, known as liabilities. If the assets are less than the liabilities then a recovery plan needs to be agreed to provide additional contributions from participating employers.
The valuation involves assessing the employer covenant, the financial support provided to the scheme by the participating employers, which is an important factor in determining the assumptions used in the calculation of the liabilities. TPT Retirement Solutions works closely with the Scheme Committee (SC) and Employer Committee (EC) during the valuation to discuss employer covenant, the assumptions and the recovery plan, where applicable.
The valuation date is 30 September 2020, and we are working towards sharing the preliminary results with employers in spring 2021.
As we approach the valuation date, we are sharing a series of five-minute reads, all of which are relevant to the valuation process. The topics include:
- Integrated risk management
- Employer covenant
- The Trustee’s approach to funding
- The Trustee’s approach to investment
Please look out for these reads in your inbox.