Valuation and Report and Accounts

Valuation results

The assets of the Plan are held separately from the Company. Every three years the Plan is required to undergo a formal valuation.

This year we completed the formal valuation as at 30 June 2024, where we review the Plan’s funding position. This involves comparing the future pensions and other benefits the Plan expects to pay (liabilities) against the value of the assets the Plan holds and identifies if there is a deficit or a surplus in funding.

Although there are a number of different ways to measure the funding position, this report gives the results of two methods used by the Plan actuary.

The ongoing basis − this shows what might happen if the Plan continues with business as normal.

The solvency basis − this shows what might happen if the Plan were to be wound up or discontinued.
 

The ongoing basis

Overall funding level

Funding results by section

The change in funding levels is mainly a result of rising gilt yields and the performance of the Plan’s investments. This impacts the Redland Section more than the Blue Circle Section because its benefits have a greater level of inflation linking.

The Recovery Plan

The Trustee discusses and agrees with the Company how to value the Plan’s liabilities (the benefits the Plan has to pay to members) and, if there is a shortfall, agrees how this will be met over time. This is known as a Recovery Plan.

The Trustee has agreed with the Company that no additional contributions need to  be paid to address the current shortfalls of £30m in the Redland section and £1m in the Blue Circle section (it may look from the chart above that there is no shortfall in Blue Circle but this is because the asset and liability figures have been rounded to the nearest million). Instead, we expect the shortfall will be cleared mainly by investment returns.

Solvency basis

Although there is no intention of winding up the Plan (closing the Plan and transferring assets to an Insurer to pay future benefits), the Trustee is required to advise members what the position would be if the Plan had to be wound up.

At 30 June 2024, the estimated amount required to secure all members’ benefits with an insurance company if the Plan was wound up, was approximately £2,265 million. This would leave a shortfall of £105 million, an improvement of £358m from the 2021 valuation.

Pension Protection Fund

The government set up the Pension Protection Fund (PPF) to pay benefits to members of Defined Benefit pension schemes in circumstances where a scheme is wound up and the scheme and the participating employers do not have enough money to cover the cost of buying all members’ benefits with an insurance company.

In these circumstances, the pension benefits you would receive from the PPF may be less than the full benefit you have earned in the Plan, depending on your age and when your benefits were earned.

Payments to the Company

We can confirm that there have not been any payments to any company in the Holcim Group from the Plan in the previous 12 months.

The Pensions Regulator

The Pensions Regulator is responsible for regulating work-based pension schemes in the UK. Its aims include protecting members’ benefits and promoting good scheme administration. You can find more details at www.thepensionsregulator.gov.uk.

We need to tell you if the Regulator has used its powers in relation to the Plan over the last year, for example, by changing the way future benefits build up, or the way the funding target is worked out, or amending the employer contribution rate.

We are pleased to confirm that the Regulator was sent details of the valuation and has not used its powers in relation to the Plan over the last year

Report and accounts

Membership

As at 30 June 2024, membership of the Plan was as follows:

Total membership 20,123.

Plans finances

The table shows a summary of the Plan’s financial transactions, taken from the audited accounts for the year to 30 June 2024. It includes contributions paid in and benefits paid out to members. You can find the full set of audited accounts in the document centre.