NDA awards Deloitte actuarial contract
UK - The Nuclear Decommissioning Authority has appointed Deloitte Total Rewards and Benefits to provide actuarial advice on the pension arrangements which fall within the organisation’s remit.
The NDA - responsible for the decommissioning and clean-up of the UK’s civil public sector nuclear sites - initiated a search in February for both legal and actuarial advice for its pension arrangements, as it is responsible for a number of defined benefit (DB) and defined contribution (DC) schemes which have collective investments of around £2bn (€2.34bn). (See earlier IPE article: Nuclear authority tenders for advice)
Deloitte Total Rewards and Benefits will now provide actuarial advice to the NDA in relation to these pension schemes, alongside Hammonds who was appointed to provide legal advice to the organisation earlier this month. (See earlier IPE article: West Yorks tenders for custodian as NDA appoints lawyers)
Figures from the NDA’s latest annual report for 2008/09 - released last week - showed employees of the organisation are members of the Principal Civil Service Pension Scheme (PCSPS). But while this is an unfunded multi-employer DB scheme, it is classed as a DC arrangement in the financial statements as the NDA is “unable to identify its share of the underlying assets and liabilities”.
The report meanwhile noted that the pension benefits of certain groups of staff - such as some employees from International Nuclear Services Limited (INSL) and Pacific Nuclear Transport - are classed by the NDA as DC arrangements as it cannot specify its share of the assets and liabilities.
These schemes include the DC section of the Direct Rail Services Limited (DRSL) pension scheme, part of the GPS Pension Scheme; the UK Atomic Energy Authority (AEA) Combined Pension Scheme; the Magnox Electric Group of the Electricity Supply Pension Scheme, and the DC Merchant Navy Officers’ Pension Plan (MNOPP) and the Merchant Navy Ratings’ Pension Plan (MNRPP).
However, the figures noted the annual contributions to the DC schemes totaled £8.46m in the year, up from £6.5m in 2007/08.
In addition to the DC schemes, the NDA is also lead employer in four DB schemes - the DRSL DB section of the GPS pension scheme, formerly known as the British Nuclear Fuels scheme, the Nirex Pension Scheme (Nirex); the Merchant Navy Officers Pension Fund (MNOPF) and the Merchant Navy Ratings Pension Fund (MNRPF).
Figures from the annual report showed the total assets for the DB schemes had dropped from £70m to £62m, although liabilities had reduced from £80m to £73m, and while this results in a deficit of £11.79m the NDA’s share is only £1.79m a slight rise from the £1.1m in 2007/08.
Deloitte will now take on the actuarial services; a role already provided to the Combined Nuclear Pension Plan (CNPP) - a scheme with both DB and DC elements formed by the NDA in 2006 to ensure existing nuclear sector employees were not adversely affected by the NDA awarding strategic management contracts for sites to Parent Body Organisations (PBO).
Under the terms of the three-year contract, Deloitte will be expected to provide the NDA with advice on a range of areas including “legislative and policy protections which apply on compulsory transfers of employees” particularly bulk transfers, as well as benefit design, triennial valuations and funding matters.
The NDA has also announced it had extended the contract for the UKAEA pension administration office to manage the CNPP for a further two years following a recommendation from the scheme trustee.