Tesco PLC - Tesco Pension Scheme
19 February 2003
TESCO BOOSTS FUNDING OF PENSION SCHEME
Tesco today said that it is to increase the amount the company pays into its
Final Salary pension scheme. This is alongside a smaller increase in staff
contribution, following the three-year actuarial valuation. Tesco will pay more
than two thirds of the extra cost required, more than double the employee
The result of our three-year actuarial valuation is a deficit of £159m. We are
91% funded, compared to 96% in 1999.
"We have always taken a proactive and responsible approach to managing pension
schemes. This early move will ensure that future benefits are safeguarded and
that the best interests of staff and shareholders are met.
Our pensions schemes are amongst the best in the industry. We recognise that
Pensions play a vital part in the rewards package and is part of the reason that
people like to work for Tesco".
Notes for Editors:
1. Tesco has two schemes the final salary scheme, and the Pension Builder
scheme, which covers the majority of Tesco staff and is not affected by this
2. Tesco has a large but immature pension scheme. The Final Salary scheme has
40,000 members and the Pension builder scheme has 80,000 members. There are
only 10,000 pensioners in the scheme.
3. Two years ago we announced our ground breaking Pension Builder career
scheme, a defined benefits scheme which bucks the trend towards less secure
money purchase schemes. Pension Builder now has 80,000 members, providing
them with a flexible and transparent investment for the future.
4. Pension Builder provides defined benefits to full-time, part-time and
temporary employees. The scheme takes into account overtime and is
particularly suitable for retail staff who work varying hours.
5. In addition to good Pensions, our staff enjoy the best benefits package in
the industry including:
* One of the best pay rates in the sector
* £38 million profit share paid out in 2002
* £68 million payout from Save As You Earn schemes in 2003
* A Buy As You Earn scheme offering staff the chance to buy tax free shares
from their gross pay;
* Staff discount
* Access to a range of voluntary benefits including healthcare, financial
advice, and leisure deals.
Investor Relations Lucy Cross 01992 646663
Press Karen Marshall 01992 644645
The Maitland Consultancy Angus Maitland 020 7379 5151
This information is provided by RNS
The company news service from the London Stock Exchange
1500 19 Feb 03