UK – Jardine Lloyd Thompson is to close its UK defined benefit pension scheme to new entrants and make a one-off payment of 50 million pounds (74 million euros) to the scheme.
The news comes as the firm’s employee benefits group posted a 38% increase in profit in 2003.
JLT said that the 172.3 million-pound scheme had a deficit of 157 million pounds under the FRS17 accounting measure – which translates into a balance sheet liability of 109.9 million pounds after deferred tax.
“As a result, it has been decided since the year-end that the group’s UK defined benefit scheme will be closed to new entrants and the certain changes will be made to the benefits that will accrue to existing members in respect of future service,” JLT said.
Company secretary David Hickman was unable to provide details of the changes, saying the company was in the process of talking to staff.
“Our employees remain our most important asset and this response underlines our commitment to our staff,” the firm said in a statement. “We also consider that this strikes an appropriate balance between the interests of scheme members, the group and its shareholders.”
It said the 50 million-pound contribution to the scheme would have a “significant and immediate impact in reducing the deficit”.
The company also said its employee benefits group posted a pre-tax profit of 9.7 million pounds, 38% up on 2002’s seven million pounds. Revenue at the arm rose 2.3% to 76.2 million pounds.
“Revenues were driven through a mixture of new client acquisitions, client penetration and free increases at contract renewal,” it said.
Overall, the company – the UK’s largest insurance broker – said pre-tax rose to 113.7 million pounds from a restated 102.3 million pounds the previous year.