UK - Computer giant IBM has pledged to contribute an extra £180m to its UK final salary scheme to safeguard its future.
The firm will pay the sum over the next three years in a bid to plug the fund’s £900m deficit and meet future benefit requirements. IBM has also proposed increasing and then maintaining its employer contributions – to an, as yet, unspecified amount – over the next 10 years.
IBM also wants to increase employee contributions from 4% to an unspecified amount and plans to increase its contributions to its UK defined contribution scheme.
An IBM spokesman said: “The proposed package includes increased IBM and employee contributions, as IBM confirms its commitment to the company’s retirement benefit plans. We will consult with employees prior to implementation.”
In a letter to members, IBM trustee chairman Jim Lamb revealed the firm had agreed in principle to guarantee company contributions to the fund until the first quarter of 2014. This will cover the scheme’s next three actuarial valuations.
Lamb said: “This roughly coincides with the period in which, if the future experience of the plan is in line with actuarial assumptions, company contributions are expected to extinguish the deficit.”
He added: “The guarantee is excellent news for members. It enhances the security of members’ benefits and demonstrates the continuing commitment of IBM to the plan. It has been agreed in principle that total company contributions to the DB benefit sections of the plan will be £181m in each of the next three years. This compares to £121m this year.”
Professional Pensions is looking to update its list of pensions master trusts in the UK ahead of authorisation. Can you help?
RPMI Railpen is in the next step in the journey towards achieving cost disclosure. Victoria Bell tells Stephanie Baxter about taking part in the Cost Transparency Initiative's pilot phase
Interserve's numerous defined benefit (DB) schemes have retained a sponsor link after the company entered into administration and was sold.
Chris Hannon has been named chairman of the Railways Pensions Trustee Company after a unanimous vote of approval from its board last week.