Jargon buster

The value of all the investments held by the Fund. This has been built up over time from member and Company contributions, including investment growth on those contributions.

The present value of the expected benefits due to members. This is based on the benefits members have earned and assumptions for the future made by the Scheme Actuary. This figure represents the amount expected to be needed today to pay the expected benefits.

We take the value of the assets in the Fund and compare it to the value of the liabilities as a percentage.

When there are more assets in the Fund than expected liabilities, the funding level is more than 100%.

The income on investments.

Government-issued bonds that increase their value and repayment amount based on changes in inflation.

The actuary uses the yield on UK Government bonds to value our liabilities. We therefore hold assets that closely match the change in the value of pension liabilities, predominately index-linked gilts (a UK Government Bond).

Assets that aim to increase in value, such as equities (investments in the shares of companies listed on a stock exchange), bonds (loans made to companies), property, hedge funds and private equity.

A reference point for measuring how well investments have performed. A benchmark may be the performance of the wider market or a return target.

The sponsoring employers’ legal obligation and financial ability to support a pension scheme, now and in the future.