Our priority is to protect the security of your pension, making sure that the Scheme is in good financial health and pensions are paid correctly and on time to all members.
Every three years, we complete an in-depth financial health check known as an actuarial valuation. We ask the independent Scheme Actuary to check the difference between how much the Scheme needs to be able to pay the pensions built up (liabilities) and the total amount set aside in the fund to pay those pensions (assets).
It takes a few months to work out the results and agree them with M&S. It shows whether the Scheme is in surplus and the assets are worth more than the liabilities, or if it is in deficit and the assets are worth less than the liabilities. It's important because it tells us whether the Scheme’s investments are on track or if we need to take action.
The latest results.
The results of the actuarial valuation as at 31 March 2024 are provided below, alongside the results of the previous actuarial valuation. The Scheme is in a secure position with a surplus of £288m and a funding level of 105%.
What these results tell us.
As at 31 March 2024 the Scheme’s liabilities had decreased. At the same time the asset values had decreased, but are still more than the liabilities meaning that the Scheme remains in surplus.
This drop in assets and liabilities was largely due to the increase in interest rates the UK has experienced over the last few years. When interest rates increase, the amount the Scheme needs to pay future pension payments reduces. At the same time, the value of certain investments in the Scheme’s assets, such as government bonds and insurance policies, held to match the value of future pension payments, also decrease in value.
Despite the drop in values of the assets and liabilities, the Scheme’s funding level was stable and remains above 100%. This reflects the Scheme’s investment strategy, which is designed so that movements in the assets and liabilities are broadly matched.
What happens next.
We’ll continue to closely monitor the Scheme’s financial health, and we’ll provide the annual financial health check later this year as part of the member newsletter. For more detailed information about these results, please go to the Financial health check webpage.