The pension fund’s actuary carries out a valuation of the fund every 3 years in line with Local Government Pension Scheme (LGPS) regulations. The purpose of the valuation is to review the financial position of the fund and to set employer contribution rates and is effectively the fund’s triennial budgeting exercise.
The actuary estimates the amount of assets that will be required to meet the benefit payments owed to members as they fall due. Separate calculations are carried out to identify the expected cost of members’ benefits in respect of scheme membership completed before the valuation date (past service) and that which is expected to be calculated after the valuation date (future service).
A funding ratio is calculated by the actuary which compares the value of the assets and the past service liabilities at the date of the valuation. This ratio provides a check against the aim of meeting the longer term funding level target.
The valuation exercise is complex. The actuary needs to make assumptions about future:
- rates of inflation
- salary increases
- investment returns
The fund’s actuary is Hymans Robertson LLP.
Actuarial reports, including the rates and adjustments certificates that set out employer contribution rates, must be obtained before the first anniversary of the valuation date.
The latest valuation report, including the rates and adjustments certificate, is attached to this page.
Links to useful documents