CWU CONSOLIDATED ACCOUNTS 2015 – QUESTIONS TO THE ACCOUNTS

CWU CONSOLIDATED ACCOUNTS 2015 – QUESTIONS TO THE ACCOUNTS
LTB 212/16 CWU Consolidated Accounts 2015 dated 6th April 2016 stated as follows:
“Accordingly Branches are now invited to forward questions to the attached CWU Consolidated Accounts 2015 to arrive by no later than 12:00 hours on Wednesday the 20th April 2016.
Please note all questions should be sent to the email address sdgs@cwu.org or by post addressed to the Finance Department at CWU HQ. Please note, any emails sent to any other email address will not receive a response and will not be included in the published questions and answers.”
At the closing time and date the following question had been submitted by South East London Postal and Counters Branch:
We are seeking an explanation regarding the increased superannuation schemes administration cost. In 2014 the costs were £308,686, but in 2015 £637,862. Can you also give the projected cost for future years going forward?
The costs over and above the 2014 costs have risen as follows. CWU 2000 Scheme increase of £19,744. NCUSSS increase of £91,776. UCW 2001 Scheme increase of £233,820. Employers pension advice decrease of £21,164.
The increase in costs in the CWU is relatively small and simply reflects the increase in costs necessary to run a scheme that has the majority of CWU employees in it. As a relatively immature scheme it has the lowest of the admin charges of the three schemes the employer sponsors. For the future and following the 2014 triennial actuarial valuation we have agreed that the CWU will pay scheme admin charges of £140,000 p.a. up until the next valuation (Dec 2017).
For the NCUSSS and the UCW 2001 Schemes the issue was that in prior years i.e. pre 2015 these payments were being shown as part of the deficit contribution in the Statement of Financial Position (balance sheet) as part of the pension deficit in the formal accounts. These administration costs are not part of the deficit and should be shown in the Statement of Comprehensive Income as part of the head office expenditure. In 2015 they have been shown correctly, which is the reason for almost the entirety of the increase. These contractual administration costs came to £361k and were made up of £113k costs for the NCUSSS scheme and £248k of costs for the UCW 2001 scheme.
For the future and following the triennial valuation we have agreed that the CWU will pay admin charges to the NCUSSS of c.£125,000 p.a. and to the UCW 2001 Scheme £150,000, until the next valuation (December 2017). 
With regard to the future it is entirely possible, depending on scheme investment performance or changes to market conditions that extra demands will be placed upon scheme administration costs to ensure the scheme funding positions remains as good as they possibly can. This could incur additional costs over and above the costs identified above, these figures being the best we are able to forecast and establish at the time of concluding the 2014 triennial valuations.
Any enquiries regarding this Letter to Branches should be addressed to the Senior Deputy General Secretary’s Department on telephone number 020 8971 7237, or email address sdgs@cwu.org.
Yours sincerely,
 
TONY KEARNS
SENIOR DEPUTY GENERAL SECRETARY
Email Attachments – Click to download
· LTB 250/16 – CWU Consolidated Accounts 2015 – Questions to the Accounts

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