Deloitte pension liability hits £234m

Deloitte’s balance sheet liability for its pension scheme has increased from
£67m to an eye-watering £234m a year later.

The information was revealed in the firm’s latest annual accounts for the
year ending 31 May 2009, with an overall increase in obligation to the defined
benefit scheme to £621m from £484m.

The firm said that actuaries had run the rule over its pensions position, and
its figures also include a liability from its Swiss employees’ scheme liability
to the tune of £54m, which was absent in the 2008 accounts.

Deloitte has now made provisions of £36m for its pensions scheme, compared to
£12m a year earlier.

One actuarial consultant said: “Statutory inflationary increases to deferred
pensions have been high for the last few years and so these alone could count
some way towards the loss.”

A statement by Deloitte said: “The result of the valuation is a combination
of the change in the assets and a change in the liabilities of the scheme.

“We have an agreed deficit funding arrangement in place which is reviewed and
revised periodically in conjunction with the pension trustee. We are currently
carrying out such a review and expect this to be completed during the next few
weeks.”

The valuation assumes annual improvements in mortality rates of about 1% per
annum for males and females.

Pension pressure

Assumed life expectancy on retirement age of 65

Retiring today

Males (2009) – 23 years; Males (2008) – 22 years

Females (2009) – 27 years; Females (2008) – 25 years

Retiring in 20 years time

Males (2009) – 25 years; Males (2008) – 22 years

Females (2009) – 29 years; Females (2008) – 25 years

Source: Deloitte accounts year ending 31 May 2009

Further reading:

Trade
body calls for pension accounting overhaul