National Grid’s net pension deficit has fallen by £45m over the year to 31 March 2019, from £263m to £218m under an IAS19 basis.

Publishing its full year results today, 16 May 2019, the utility company said the reduction in the deficit primarily reflects changes in actuarial assumptions resulting in an increase in liabilities, asset performance being more than the discount rate, and employer contributions paid over the accounting period.

As at 31 March 2019, its net pension asset are £1,567m (£1,409m 2018) and liabilities are £1,785m (£1,672m).

It also referenced the High Court judgment in October 2018 that confirmed GMP benefits must be equalised between men and women, which also provided alternative prescribed methods of equalisation.

“This provides much-needed clarity, as there has been uncertainty in pensions law as it pertains to GMP equalisation. However, schemes cannot directly equalise the GMPs, but need to adjust other benefits in order to achieve this, through correcting the ongoing position and making back-payments to affected members,” it said.

National Grid estimates that the cost of equalising the benefits, as well as the cost implications in the calculation and implementation of the equalisation method will be around £34m. It said this figure has been recognised in the consolidated income statement as past service costs.

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