i) Company sponsored / Group affiliated schemes
Certain former employees of the Company were members of a defined benefit scheme which is sponsored by another Group Company, Irish Ferries Limited. The stated policy between the sponsoring entity and the Company does not require the Company to recognise the net defined benefit in its individual financial statements. Detailed information in respect of this scheme is given in note 31 to the Consolidated Financial Statements. Other former employees were members of the Ex Merchant Navy Officers Pension Fund (Ex MNOPF), of which the Company is the sponsoring employer.
The contributory defined benefit schemes sponsored by the Company and the Group companies provide retirement and death benefits for former employees. The defined benefit schemes provide benefits to members in the form of a guaranteed level of pension payable for life, the level of the benefits depend on the member’s length of service and salary. The assets of these schemes are held separately from those of the Company and Group in schemes under the control of trustees. The trustees are responsible for ensuring the schemes are run in accordance with the applicable trust deeds and the pension laws of the relevant jurisdiction. The pensions charge and payments in respect of the schemes are in accordance with the advice of professionally qualified actuaries.
The latest actuarial valuation report for the Ex MNOPF Scheme, which is not available for public inspection, is dated 29 June 2021. The valuation employed for disclosure purposes has been based on the most recent funding valuations for the schemes adjusted by the independent actuaries to allow for the accrual of liabilities up to 31 December 2022 and to take account of financial conditions at this date.
The present value of the defined benefit obligation, and the related current service cost and past service credit, were measured using the projected unit credit method and assets have been valued at bid value.
ii) Merchant Navy Officers Pension Fund (MNOPF)
In addition to the pension schemes operated by the Company, certain former employees are members of the MNOPF, an industry wide multi-employer scheme. The latest actuarial valuation of the scheme, which is available for public inspection, is dated 31 March 2021 and disclosed a net past service surplus of £55.0 million, equivalent to a gross funding level of 102%. The Company’s share of the MNOPF obligations, as most recently advised by the trustees, is 0.33% (2021: 0.51%). The obligation valuation in these financial statements at 31 December 2022 is based on the actuarial deficit contribution demands notified to the Company and which remain outstanding at the reporting date. The last deficit demand received by the Company was dated May 2013 which has been fully paid.
The share of the overall deficit in the MNOPF apportioned to the Company is €nil at 31 December 2022 (2021: €nil). During the year the Company made payments of €nil (2021: €nil) to the trustees.
iii) Principal risks and assumptions
The principal risks and assumptions used for the purpose of the actuarial valuations are set out in note 31 (iii) of the Consolidated Financial Statements.
The Company’s total obligation in respect of the defined benefit schemes is calculated by independent, qualified actuaries, updated at least annually and totals €0.7 million at 31 December 2022 (2021: €0.9 million). At 31 December 2022, the Company also has scheme assets totalling €1.7 million (2021: €2.0 million) giving a net pension surplus of €1.0 million (2021: €1.1 million). The size of the obligation is sensitive to actuarial assumptions.
iv) Retirement benefit assets and liabilities
The amount recognised in the Statement of Financial Position in respect of the Company’s defined benefit schemes, is as follows:
|
2022 |
2021 |
|
€m |
€m |
Equities |
1.2 |
1.5 |
Bonds |
0.3 |
0.3 |
Property |
0.1 |
0.1 |
Other |
0.1 |
0.1 |
Fair value of scheme assets |
1.7 |
2.0 |
Present value of scheme liabilities |
(0.7) |
(0.9) |
Surplus in schemes |
1.0 |
1.1 |
The retirement benefit scheme sponsored by the Company is in a net surplus position. In addition, the Company’s share of the deficit in the industry wide scheme, the MNOPF, based on the last actuarial valuation as at 31 March 2021 is €nil (2021: €nil). The total surplus of €1.0 million (2021: €1.1 million) is shown under non-current assets in the Statement of Financial Position.
The Company is exposed to a number of actuarial risks, these include demographic assumptions covering mortality and longevity, and economic assumptions covering price inflation, benefit and salary increases together with the discount rate used. The size of the scheme assets is also sensitive to asset return levels and the level of contributions from the Company.
v) Movement in retirement benefit assets
Movements in the fair value of scheme assets in the financial year were as follows:
|
€m |
2022 |
|
At beginning of the financial year |
2.0 |
Actuarial losses |
(0.3) |
At end of the financial year |
1.7 |
|
|
2021 |
|
At beginning of the financial year |
1.7 |
Actuarial gains |
0.3 |
At end of the financial year |
2.0 |
vi) Movement in retirement benefit liabilities
Movements in the present value of defined benefit obligations in the financial year were as follows:
|
€m |
2022 |
|
At beginning of the financial year |
0.9 |
Actuarial gains |
(0.2) |
At end of the financial year |
0.7 |
|
|
2021 |
|
At beginning of the financial year |
1.0 |
Actuarial losses |
(0.1) |
At end of the financial year |
0.9 |
The present value of scheme liabilities at the financial year ended 31 December 2022 and 31 December 2021 relate to wholly funded plans.
vii) Amounts recognised in the Company Income Statement
There were no amounts recognised in the Company Income Statement in respect of defined benefit obligations in the period (2021: €nil).
The estimated amounts of contributions expected to be paid by the Company to the schemes during 2022 is €nil based on current funding agreements.
viii) Amounts recognised in the Company Statement of Comprehensive Income
Amounts recognised in the Company Statement of Comprehensive Income in respect of defined benefit obligations are as follows:
Actuarial gains and losses:
|
2022 |
2021 |
|
€m |
€m |
Actual return on scheme assets |
- |
- |
Interest income on scheme assets |
- |
- |
Return on scheme assets (excluding amounts included in net interest cost) |
- |
- |
Remeasurement adjustments on scheme liabilities: |
|
|
Losses arising from experience adjustments |
(0.3) |
- |
Gains arising from changes in financial assumptions |
0.2 |
0.4 |
Actuarial (loss) / gain recognised in Statement of Comprehensive Income |
(0.1) |
0.4 |