Report and Financial Statement 2023
The Trustees of the BBC Pension Scheme recently published the results of the 2023 Interim Actuarial Valuation and Scheme Accounts as at 31 March 2023. This article summarises the published information available.
Membership
The total number of Scheme beneficiaries on 31 March 2022 was 45,416* excluding dependants: 1.8% less than last year.
| Membership | 2022 | 2023 |
|---|---|---|
| Contributing members | 7,215 | 6,800 |
| Deferred members | 26,693 | 25,776 |
| Pensioners | 25,742 | 26,211 |
| Total | 59,650 | 58,787* |
* The total number of Scheme beneficiaries was 45,416, excluding dependants. Membership numbers in the table above are higher as members can hold more than one record. For example, existing members who joined the Career Average Benefits 2011 section from another section of the Scheme may have a deferred pensioner record for their benefits built up in the Old Benefits, New Benefits or Career Average Benefits 2006 sections and a contributing record for their Career Average Benefits 2011 benefits.
The BBC Pension Scheme was closed to new entrants on 1 December 2010.
Contributions
On 1 April 2022 the BBC contribution rate for future service benefits for active Scheme members was 42.3% of Pensionable Salaries, but this was reduced to 30% of Pensionable Salaries from 1 July 2023. In addition, the BBC paid deficit contributions of £75m with the aim of eliminating the deficit within the Scheme by 31 December 2028. The total contributions to the Scheme during the year to 31 March 2023 was £241.1m, of which the BBC contributed £239.7m (excluding members’ contributions paid by salary sacrifice).
Payment of Benefits
The following Table shows the value of the benefits paid out during the year:
| Payment of Benefits | 2022 £m | 2023 £m |
|---|---|---|
| Pensions | 433.4 | 465.6 |
| Lump sum retirement benefits | 18.6 | 20.9 |
| Lump sum death benefits | 2.9 | 2.4 |
| Lump sum AVC benefits | 9.9 | 7.7 |
| Total | 464.7 | 494.6 |
Pension Increases
The review period for BBC pension increases is January to December, with any increases paid from the following 1 April. The following pension increases were awarded to pensions in payment from 1 April 2023:
| Section of Scheme | Guaranteed Increase | Increase Awarded |
|---|---|---|
| Old Benefits Member | 10% or RPI if less | 10% |
| New Benefits Member | 5% or RPI if less | 5% |
| CAB 2006 Member | 2.5% or rise in CPI if less | 2.5% |
| CAB 2011 Member | 4% or rise in CPI if less | 4% |
Investment Return
The Scheme’s assets produced an investment return of -24.2% in 2022/23, largely due to falls in the value of the Scheme’s liability matching bonds. Over the past 5 years, the Scheme’s investment return was -0.5% on an annualised basis. Over the very long term, since 1978, the Scheme’s investments have generated an annualised return of approximately 10%.
Funding level
The value of the Scheme’s investments (including Additional Voluntary Contributions (AVC) investments) was £14.7bn on 31 March 2023, down by £5.1bn from the end of the previous year. Although the asset values have fallen, this has been matched by an even greater drop in liability values i.e., the expected cost of paying benefits now and in the future has also reduced. The Scheme’s funding position has improved as the present value of liabilities fell by more than the market value of assets over the year.
The following Table sets out the assets compared with the liabilities under the Scheme over the last three actuarial valuations.
| 2021 interim valuation (1 April 2021) | 2022 valuation (1 April 2022) | 2023 interim valuation (1 April 2023)4 | |
|---|---|---|---|
| Assets | £19.0bn | £19.8bn | £14.7bn |
| Liabilities | £19.5bn | £20.7bn | £14.6bn |
| Shorfall (Deficit) | £0.5bn | (£841m) | £103m |
| Funding Level | 97.5% | 96% | 101% |
At the 2023 interim actuarial valuation the Scheme showed a small surplus of £103m, which meant that it was 101% funded.
Changes to the Trustee Board
David Gallagher resigned as a member nominated trustee on 11 May 2022 and Glyn Isherwood resigned as a BBC appointed trustee on 31 May 2022.
Shirley Cameron was appointed as a BBC appointed trustee on 1 June 2022 and Hannah Sander was appointed as member nominated trustee on 21 September 2022.
Further information
The Scheme accounts, as well as more information about the Scheme and its investments, can be found at: bbc.co.uk/my pension
