Barclays 2005 Annual Report Download - page 196

38 Retirement benefit obligations (continued)
The pension and post-retirement benefits assets and liabilities recognised on the balance sheet are as follows:
2005 2004
Post-retirement Post-retirement
Pensions benefits Total Pensions benefits Total
UK Overseas UK Overseas UK Overseas UK Overseas
£m £m £m £m £m £m £m £m £m £m
Benefit obligation at
end of period (18,149) (938) (103) (79) (19,269) (15,494) (522) (80) (65) (16,161)
Fair value of plan assets at
end of period 15,571 819 – – 16,390 13,261 436 – – 13,697
Net obligation (2,578) (119) (103) (79) (2,879) (2,233) (86) (80) (65) (2,464)
Unrecognised actuarial losses 1,039 63 29 11 1,142 619 41 11 7 678
Unrecognised past service cost ––––––––––
Other unrecognised amounts ––––––––––
Net recognised liability (1,539) (56) (74) (68) (1,737) (1,614) (45) (69) (58) (1,786)
Recognised assets 52 34 – – 86 49 30 – – 79
Recognised liability (1,591) (90) (74) (68) (1,823) (1,663) (75) (69) (58) (1,865)
Net recognised liability (1,539) (56) (74) (68) (1,737) (1,614) (45) (69) (58) (1,786)
The Group is expected to pay contributions of approximately £350m to UK schemes and £15m to overseas schemes next year.
The assets of all the funded plans are held independently of the Group’s assets in separate trustee administered funds. Defined benefit schemes are
valued by independent actuaries for accounting purposes using the projected unit credit method every year. The latest actuarial valuations were
carried out as at 31st December 2005 using the following assumptions:
UK schemes Overseas schemes
2005 2004 2005 2004
% p.a. % p.a. % p.a. % p.a.
Discount rate 4.8 5.4 1.0-25.0 1.5-24.5
Expected return on plan assets 5.3-7.1 5.3-7.3 0.8-25.0 0.8-25.5
Rate of increase in salaries 4.3 4.3 2.2-22.0 2.2-18.0
Rate of increase for pensions in payment and deferred pensions 2.75 2.75 0.0-17.0 0.0-13.0
Initial health care inflation 10.0 10.0 7.5-11.0 7.5-11.0
Long-term health care inflation 5.0 5.0 5.0-7.5 5.0-7.5
The overseas health care inflation assumptions relate to the US and Mauritius.
Mortality assumptions
The post-retirement mortality assumptions used in valuing the liabilities of the UKRF were based on the standard tables PA92 as published by the
Institute and Faculty of Actuaries. These were then adjusted in line with both current industry experience and the actual experience of the UKRF’s own
pensioners relative to the standard table. On this basis, the life expectancy assumed at 31st December 2005 for a male pensioner then aged 60 was
25.8 years and for a female pensioner then aged 60 was 29.5 years. Based on the assumed mortality improvements, by 31st December 2025 the life
expectancy for a male pensioner then aged 60 will have increased to 27.1 years and for a female then aged 60 years will have increased to 30.6 years.
Notes to the accounts
For the year ended 31st December 2005
Barclays PLC
Annual Report 2005
194