DB funding proposals
If a funded defined benefit pension scheme would not meet its funding standard liabilities and additional risk reserve on wind-up, the trustees must submit a funding proposal to the Pensions Authority that explains how they propose to deal with the deficit over the following three years. In certain circumstances, the Authority can allow the trustees more time to rectify the scheme’s funding.
The actuary must include an ‘inter-valuation statement’ in the trustees’ annual report for each year. It must state whether, in the actuary’s opinion, the scheme can meet the funding standard liabilities and risk reserve on the last day of the period to which the annual report relates.
If the trustees have previously submitted a funding proposal to the Authority, the inter-valuation statement must state whether in the actuary’s opinion, the scheme is ‘on-track’ to meet the funding standard liabilities and risk reserve, if applicable, by the end of the period of the funding proposal.