SCOTLAND - Scottish Power has more than doubled contributions into its final salary pension schemes in a bid to stem an FRS17 deficit of £231m.
The utility firm increased its annual payments into the three schemes – worth £2.3bn – from £7m to £16m.
Scottish Power’s financial results for 2002-03 blamed the increased pension costs for its reduced operating profit.
A company statement said: “Operating profit decreased by £5m to £50m for the quarter to March 31, primarily due to increased pension costs.”
Scottish Power runs three final salary schemes: the Scottish Power Pension Scheme, Manweb Pension Scheme and Scottish Power Group Final Salary Lifeplan. It also runs the £1.6m Scottish Power Group Money Purchase Plan.
*Investment bank UBS Warburg has warned the value of utility firms will be hit by pension scheme deficits.
In a report released earlier this year it predicted the cost of plugging Scottish Power’s pension schemes’ deficits would be equivalent to 6% of the company’s total value.
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