4 February 2025
Trustees have recommended that 100% of future surpluses go to members
In its election manifesto, the Labour Government committed to reviewing the Scheme’s surplus sharing arrangements. Following the transfer of the Investment Reserve, the Trustees met with representatives from the Department for Energy and Net Zero (DESNZ), the department responsible for the Scheme, in December and January to express their views.
Currently, any surplus is shared 50/50 between the Government and members. The Trustees have put forward their view that 100% of any future surpluses should go to members and be used to give members bonus pensions, provided the Scheme is not in deficit.
The Trustees have also recommended that around £1bn currently earmarked for return to the Government from earlier surpluses be kept in the Scheme. And that these funds are used to give extra bonus pensions to members over time, if the Scheme is not in deficit.
Finally, the Trustees have asked the Government to protect the bonus pensions paid to members in 2024, so that they cannot be reduced if the Scheme has a deficit in the future.
If the Government accepts our recommendations, it will mean more money going to members and less to the Government. Higher bonus pensions could then be paid to members in the future, and members would have the reassurance that unprotected bonus pensions could not be reduced.
Discussions are still at an early stage and it may take significant time to reach a final agreement. In any event, the earliest that new surplus sharing arrangements could come into effect would be following the September 2026 Scheme valuation.
We will share the outcome of this review as soon as we can. Any updates will be posted on the news page of this website.