Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • January 2015
01

Tesco to close DB pension scheme

Open-access content Thursday 8th January 2015 — updated 5.13pm, Wednesday 29th April 2020

Tesco is planning to close its defined benefit pension schemes to existing and new employees in response to its financial troubles.

2

As part of wider measures to reduce costs, the supermarket retailer is looking to deliver savings of £250m per year at a one-off cost of £300m.

It said it would close the company DB pension scheme to all new and existing employees following a consultation period with staff. Tesco's decision would leave just three FTSE100 companies with DB schemes open to new members - Morrisons, Diageo and Johnson Matthey.

The supermarket will also close 43 unprofitable stores and consolidate its head office locations, closing its Cheshunt office in 2016, it said and making Welwyn Garden City the UK and Group centre.

Tesco chief executive Dave Lewis said: 'We have some very difficult changes to make. I am very conscious that the consequences of these changes are significant for all stakeholders in our business but we are facing the reality of the situation.

'Our recent performance gives us confidence that when we pull together and put the customer first we can deliver the right results.'

Commenting on the decision, Jon Hatchett, head of corporate DB at actuaries Hymans Robertson said, that, on the back of a turbulent 2014, the financial pressures of running a DB pension scheme 'will have taken their toll'.

'Almost a third (32%) of the 6,000 DB schemes are already closed to future accrual,' Hatchett said.

'This figure will increase significantly over the next couple of years as schemes adjust to new pressures from major upheavals such as the end of contracting out and record low bond yields.'

Sainsbury's closed its DB scheme just over a year ago.

This article appeared in our January 2015 issue of The Actuary.
Click here to view this issue
Filed in
01
Topics
Pensions

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Senior Catastrophe Analyst

London, England
£70000 - £100000 per annum
Reference
146055

Catastrophe Analyst

London, England
Up to £50000 per annum + + Bonus
Reference
146053

Principal Pricing Analyst

England, London
£60000 - £70000 per annum
Reference
146052
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ