Barclays 2012 Annual Report Download - page 299

The strategic report Governance Risk review Financial review Financial statements Risk management Shareholder information
37 Pensions and post-retirement benefits continued
Governance
The UKRF operates under trust law and is managed and administered on behalf of the members in accordance with the terms of the Trust Deed
and Rules and all relevant legislation. The Corporate Trustee is Barclays Pension Funds Trustees Limited, a private limited company incorporated
on 20 December 1990 and a wholly owned subsidiary of Barclays Bank PLC. The Trustee is the legal owner of the assets of the UKRF which are
held separately from the assets of the Group.
The Trustee Board comprises six Management Directors selected by Barclays, of whom three are independent Directors with no relationship with
Barclays or the UKRF, plus three Member Nominated Directors selected from eligible active staff and pensioner members who apply for the role.
Similar principles of pension governance apply to the Group’s other pension schemes, although different legislation covers overseas schemes
where, in most cases, the Group has the power to determine the funding rate.
Amounts recognised
The following tables include: the amounts recognised in the income statement, an analysis of benefit obligations and an analysis of scheme assets
for all Group schemes. The net position is reconciled to the assets and liabilities recognised on the balance sheet. The tables include funded and
unfunded post-retirement benefits.
Income statement charge
2012
£m
2011
£m
2010
£m
Current service cost 357 348 349
Interest cost 1,081 1,154 1,146
Expected return on scheme assets (1,152) (1,176) (1,122)
Recognised actuarial loss 32 57 75
Past service cost 1 23 (233)
Curtailment or settlements (40) 3 16
Total 279 409 231
Balance sheet reconciliation
2012 2011
Total
£m
Of which
relates to
UKRF
Total
£m
Of which
relates to
UKRF
Benefit obligation at beginning of the year (22,994) (21,263) (21,801) (20,173)
Current service cost (357) (309) (348) (300)
Interest cost (1,081) (992) (1,154) (1,053)
Past service cost 9 – (23) –
Actuarial (loss)/gain (1,930) (1,768) (569) (418)
Benefits paid 779 690 802 684
Exchange and other movements 167 (3) 99 (3)
Benefit obligation at end of the year (25,407) (23,645) (22,994) (21,263)
Fair value of scheme assets at beginning of the year 22,748 21,540 18,905 17,621
Expected return on scheme assets 1,152 1,082 1,176 1,094
Employer contribution 840 742 2,220 2,128
Actuarial gain/(loss) 236 167 1,419 1,470
Benefits paid (779) (690) (802) (684)
Exchange and other movements (101) 4 (170) (89)
Fair value of scheme assets at the end of the year 24,096 22,845 22,748 21,540
Net (deficit)/asset (1,311) (800) (246) 277
Unrecognised actuarial losses 3,361 3,003 1,728 1,403
Net recognised asset 2,050 2,203 1,482 1,680
Recognised assets 2,303 2,203 1,803 1,680
Recognised liabilities (253) – (321) –
Net recognised asset 2,050 2,203 1,482 1,680
Included within the benefit obligation was £1,597m (2011: £1,560m) relating to overseas pensions and £165m (2011: £171m) relating to other
post-retirement benefits. Of the total benefit obligation of £25,407m (2011: £22,994m), £326m (2011: £334m) was wholly unfunded.
As at 31 December 2012, the UKRF’s IAS 19 scheme assets were in deficit versus obligations by £800m (2011: surplus of £277m). The most
significant driver for this change was the fall in real corporate bond yields relative to inflation. This was partially offset by the deficit contribution of
£500m paid in April 2012.
barclays.com/annualreport Barclays PLC Annual Report 2012 I 297