The head of the E6.7bn Unilever UK pension scheme has hit back at newspaper criticism, saying the Anglo-Dutch consumer products company “remains committed” to its defined benefits scheme and it will pay more money into the fund if needed.
“These are difficult times for pension funds and it is unfortunately just not possible to continue to act as though the financial position remained as healthy as it was in the late 1990s,” says Richard Greenhalgh, the chairman of the Unilever Pension Fund and chairman of Unilever UK. “Despite this, we remain committed to maintaining our defined benefits scheme.”
He says that Unilever bears the whole of the risk in its pension fund and that the firm guarantees that the beneficiaries will not suffer. “If necessary, it will pay more money into the fund to achieve this.”
Greenhalgh made the remarks in a letter to the Financial Times. The paper had said that the company was “scrooge-like” in telling beneficiaries that there would be no improvements in benefits, despite the pension fund‘s being in surplus, due to an actuarial valuation.
He countered these comments, saying Unilever has twice in recent years granted special increases to its pensions. He also said that with the declining stock market, it would not be prudent to make extra payments to current pensioners if “there was even the slightest chance” that this could jeopardise the position of active and deferred members if the scheme in future.
The fund has around 15,000 members, 43,000 pensioners and 32,000 deferred pensioners.