ICI takes out £250m pension insurance
ICI has set aside £250m in company assets to insure its pension scheme against insolvency.
According to today’s Financial Times, the company is also increasing top-up payments to its pension fund to £62m a year for nine years from 2004. It replaces a schedule of six annual payments of £30m agreed in 2000.
The £250m set aside will constitute an insurance policy for its pension scheme should the company become insolvent.
ICI’s new approach came as the CBI strongly criticised government plans to impose a levy on schemes to create a national pension insurance fund.
The latest actuarial valuation for ICI in March this year showed a pension deficit of £443m, even without applying controversial new accounting standard FRS17.