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The Actuary The magazine of the Institute & Faculty of Actuaries

Achieving disclosure

The latest proposal for the risk-based levy for the Pension Protection Fund is rather akin to the initial valuation of a pension scheme. If it were one, the actuary would be governed by GN9 which requires disclosure of membership data, key assumptions, and so on.

However, in the document issued on 16 December you will search in vain for data on pension scheme deficits or for the economic and demographic assumptions underlying the deterministic and stochastic calculations, apart from the reference to there being no reserve for ‘extreme’ risks. Nor is there any analysis of the sensitivity of the contribution rate to changes in the assumptions or quantification of the reasons for the required contribution nearly doubling since the previous estimate was produced, save a comparison of life expectancy in 1970, 2004, and 2021.

The actuarial profession has been widely criticised for inadequate standards in recent years but it seems to me that in the area of disclosure of pension scheme valuation data, assumptions, and results there is much of which we can be proud.