UK - Caparo, the steel manufacturer hit by the UK's first ever strike over pension issues last year, has revealed a £15.7m FRS17 deficit.
The privately-owned company’s two pensions schemes – the Armstrong Group Pension Scheme and the Caparo Group Pension Scheme – had a combined value of £129m at the end of December 2001. This makes its combined scheme funding level approximately 88%.
The company itself posted a £15.3m loss and paid no dividends in the year to December 31, 2001.
The company’s results explain its attempt to wind up one of its pension schemes and freeze the other, after concerns over the future liabilities of the funds – a move that led to a bitter industrial clash with powerful steel union ISTC.
After weeks of one-day strikes last summer the firm capitulated and agreed to restore amended versions of the final salary schemes.
Caparo now offers a cheaper 1/90 accrual rate scheme – less than the 1/80 scheme wanted by the workers, but a compromise on the 1/100 scheme bosses originally suggested.
The Caparo schemes have more than 5500 active, deferred and pensioner members and obtained actuarial advice from Garvins during the dispute.
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