GSK DB pension scheme deficit up £226m in 2022

The net deficit of the GSK Group’s defined benefit (DB) pension scheme increased from £1,129m at 31 December 2021 to £1,355m as at 31 December 2022, despite an increase in cash contributions from the sponsoring group.

The group's latest financial update showed that cash generated from operations attributable to continuing operations for the year was up compared to 2021, noting that the “significant increase” in operating profit was however, partly offset by increased cash contributions to its UK DB schemes.

GSK attributed the increase in the DB scheme net deficit to lower asset values, an increase in the US cash balance credit rate, an increase in Eurozone inflation rates, and actuarial experience adjustment for higher inflation than expected in pension increases of approximately £800m.

However, the group clarified that these factors were partially offset by increases in the long-term UK discount rate, as well as a fall in Eurozone discount rates, and cash contributions of approximately £700m made to the UK pension schemes.

More broadly, the group also provided an update on the separation of its consumer healthcare business from the GSK group to form Haleon.

This confirmed that, following the demerger, 7.5 per cent of Haleon remains held by certain Scottish limited partnerships (SLPs) set up to provide collateral for a funding mechanism pursuant to which GSK will provide additional funding for GSK's UK DB Pension Schemes.

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