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History of the Pension Fund |
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The above bar chart illustrates how the RO Pension Fund has performed between 1985 and 2010. (If viewing in Internet Explorer the actual values at the year end and significant events during this period may be revealed by hovering the cursor over each of the bars. alternatively, if your browser fails to show these, refer to the supplementary text below.) During the "fat" years when the fund has been in surplus, the sponsoring company, BAE Systems, has utilised a total of £215M for its own purposes. (See Surplus.) In contrast it has since contributed a total of £114M to the fund since it gained control of Royal Ordnance for £190M in 1987. Following the stock market crash in 2000 - 2001 the fund went into deficit by about £123M but and slowly began to climb again before the major crash in 2008. According to the annual report for 2003 the scheme was "99.3% funded on an ongoing basis". However two members of the Institute of Actuaries warned at that time that such statements by scheme actuaries were highly misleading. The official guidance notes allowed actuaries to claim that full transfer values were being paid when these transfer values would not secure even 50 per cent of the benefits if the scheme were to be wound up. BAE's Pensions Update first acknowledged the existence of a deficit in December 2005. The deficit at the end of 2009 stood at £233M and we await the publication of the 2010 actuarial review to learn the current deficit. Note: The average pension in payment for ROPS is about £5500 pa. Fund Values at Year End and Significant Events 1985: £174M. Fund established on 2 January, 1985 (Equivalent to about £400M at 2004 prices.)
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