Information on DB contribution increases
The Fund valuation at 31 December 2018 is now complete and as mentioned in previous communications, contributions to DB Core and DB CorePlus will be increasing. Below you can read about the main outcomes of the valuation and find more information on the contribution increases for DB Core and DB CorePlus members.
There are two key outcomes of the valuation:
- The valuation showed that there was a deficit in the Fund at 31 December 2018 of £500 million. From 2019 to 2021 Nestlé has paid £261 million towards this deficit. Nestlé paid off the balance of this deficit in a single payment in June 2021.
- The valuation has shown that the cost of providing future pensions in DB Core and DB CorePlus has gone up. This means that employee and employer contributions to DB Core and DB CorePlus will increase from 1 November 2021.
How much is the contribution increase?
In line with the contribution sharing arrangement, employer and employee contributions to the DB Core and DB CorePlus sections will be going up from 1 November 2021.
Read more about the contribution sharing arrangement.
Employee contributions will change as follows:
Nestlé’s contributions will change as follows:
Note: Nestlé pays the same contribution to DB Core and DB CorePlus. Members of DB CorePlus pay higher contributions to account for the difference in the rates at which pensions build up between DB Core and DB CorePlus.
What does the contribution increase mean for you?
We’ve added more information to the modeller to show you how much the contributions will cost you before and after tax and national insurance (NI) are deducted.
Remember, if your pensionable earnings are different from the earnings shown in your online account you can update your pensionable earnings to the correct value when using the modeller for more accurate results.
Don’t have an online account yet?
Registering your online account is easy. Register today to use the modeller and see some of your personalised communications online – this includes a copy of the ‘Change in DB contributions’ newsletter we sent you detailing the valuation, contribution increases and more.
You can read about the choices you have in relation to your DB account following these increases on the next page.