Summary of Defined Benefit Plan Obligations and Assets |
Defined benefit plan obligations
| | | | | | | | | | | | | | | | | | | | | | | | | | | | $ million, except where indicated | | Pension benefits | | | Other post-employment benefits | | | The Netherlands | UK | USA | Rest of the world | | | OPEB [A] | Total | At January 1 | 24,608 | 17,791 | 14,793 | 13,410 | | | 2,879 | 73,481 | Current service cost | 184 | 145 | 215 | 179 | | | 36 | 759 | Interest expense | 904 | 881 | 695 | 592 | | | 166 | 3,238 | Actuarial losses | 929 | 257 | 832 | 285 | | | 72 | 2,375 | Benefit payments | (1,032) | (1,014) | (956) | (757) | | | (88) | (3,847) | Other movements | 252 | — | — | (63) | | | — | 189 | Currency translation differences | 901 | 1,014 | — | (122) | | | 36 | 1,829 | At December 31 | 26,746 | 19,074 | 15,579 | 13,524 | [B] | | 3,101 | 78,024 | Comprising: | | | | | | | | | Funded pension plans | 26,746 | 18,734 | 14,695 | 11,298 | | | | 71,473 | Weighted average duration | 16 years | 15 years | 11 years | 13 years | | | | 14 years | Unfunded pension plans | | 340 | 884 | 2,226 | | | — | 3,450 | Weighted average duration | | 16 years | 8 years | 11 years | | | | 11 years | Unfunded OPEB plans | | | | | | | 3,101 | 3,101 | Weighted average duration | | | | | | | 13 years | 13 years |
[A]Mainly related to post-retirement medical benefits in the USA. [B]Rest of the world includes pension plans in Germany ($3,647 million) and Canada ($3,930 million) which are the largest pension plans in this category. | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ million, except where indicated | | Pension benefits | | | Other post-employment benefits | | | The Netherlands | UK | USA | Rest of the world | | | OPEB [A] | Total | At January 1 | 35,340 | 29,913 | 19,003 | 18,213 | | | 4,867 | 107,336 | Current service cost | 286 | 259 | 282 | 261 | | | 57 | 1,145 | Interest expense | 298 | 489 | 417 | 380 | | | 120 | 1,704 | Actuarial gains | (8,806) | (9,793) | (3,730) | (3,582) | | | (2,032) | (27,943) | Benefit payments | (942) | (1,124) | (1,088) | (771) | | | (178) | (4,103) | Other movements | 374 | 130 | (91) | (154) | | | 37 | 296 | Currency translation differences | (1,942) | (2,083) | — | (937) | | | 8 | (4,954) | At December 31 | 24,608 | 17,791 | 14,793 | 13,410 | [B] | | 2,879 | 73,481 | Comprising: | | | | | | | | | Funded pension plans | 24,608 | 17,474 | 13,925 | 11,258 | | | | 67,265 | Weighted average duration | 17 years | 15 years | 12 years | 13 years | | | | 15 years | Unfunded pension plans | | 317 | 868 | 2,152 | | | | 3,337 | Weighted average duration | | 15 years | 9 years | 12 years | | | | 11 years | Unfunded OPEB plans | | | | | | | 2,879 | 2,879 | Weighted average duration | | | | | | | 14 years | 14 years |
[A]Mainly related to post-retirement medical benefits in the USA. [B]Rest of the world includes pension plans in Germany ($3,477 million) and Canada ($3,482 million) which are the largest pension plans in this category. 23. Retirement benefits continued Defined benefit plan assets
| | | | | | | | | | | | | | | | | | | | | | | $ million, except where indicated | | Pension benefits | | | | | The Netherlands | UK | USA | Rest of the world | | | Total | At January 1 | 27,986 | 21,963 | 14,243 | 12,564 | | | 76,756 | Return on plan assets in excess of interest income | 833 | (999) | 609 | 800 | | | 1,243 | Interest income | 1,035 | 1,094 | 679 | 609 | | | 3,417 | Employer contributions [A] | 419 | 34 | 274 | (23) | | | 704 | Plan participants' contributions | 11 | 16 | — | 7 | | | 34 | | | | | | | | | Benefit payments | (1,032) | (1,014) | (957) | (703) | | | (3,706) | Other movements | (6) | (16) | (13) | 17 | | | (18) | Currency translation differences | 1,020 | 1,242 | — | (731) | | | 1,531 | At December 31 | 30,266 | 22,320 | 14,835 | 12,540 | [B] | | 79,961 |
[A]Includes the netted amount of $225 million received from the captive structure in relation to pension plans reinsured in Rest of the world. [B]Rest of the world includes pension plans in Germany ($2,730 million) and Canada ($3,504 million) which are the largest pension plans in this category. | | | | | | | | | | | | | | | | | | | | | | | $ million, except where indicated | | Pension benefits | | | | | The Netherlands | UK | USA | Rest of the world | | | Total | At January 1 | 37,096 | 33,720 | 18,055 | 15,624 | | | 104,495 | Return on plan assets in excess of interest income | (6,576) | (8,682) | (3,523) | (1,831) | | | (20,612) | Interest income | 314 | 552 | 406 | 460 | | | 1,732 | Employer contributions | 228 | 54 | 408 | 41 | | | 731 | Plan participants' contributions | 11 | 16 | — | 5 | | | 32 | | | | | | | | | Benefit payments | (942) | (1,124) | (1,088) | (735) | | | (3,889) | Other movements | (9) | 150 | (15) | (184) | | | (58) | Currency translation differences | (2,136) | (2,723) | — | (816) | | | (5,675) | At December 31 | 27,986 | 21,963 | 14,243 | 12,564 | [A] | | 76,756 |
[A]Rest of the world includes pension plans in Germany ($2,538 million) and Canada ($3,497 million) which are the largest pension plans in this category. | | | | | | | | | | 2023 | 2022 | Quoted in active markets: | | | Equities | 12% | 13% | Debt securities | 71% | 70% | Real estate | 1% | —% | Other | —% | 1% | Unquoted | | | Equities | 12% | 13% | Debt securities | 4% | 2% | Real estate | 7% | 7% | Investment funds | 3% | 4% | Debt repurchase agreements [A] | (11)% | (14)% | Cash | 1% | 4% |
[A]Debt repurchase agreements are mainly related to UK member defined pension plans to fund liability-driven investments. In addition to these contracts, derivatives including interest rate and inflation swaps are used in the principal defined benefit plan in the Netherlands for liability matching strategies.
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Summary of Assumptions for Sensitivity Analysis |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ million, except where indicated | | | | | Effect of using alternative assumptions | | Assumptions used at nominal rates | | Increase/(decrease) in defined benefit obligations | | Dec 31, 2023 | Dec 31, 2022 | | Range of assumptions | Dec 31, 2023 | Dec 31, 2022 | Rate of increase in pensionable remuneration [A] | 3.9% | 4.0% | | -1% to +1% | (828) | 915 | (833) | 921 | of which the Netherlands | 3.3% | 3.3% | | | | | | | of which UK | 4.1% | 4.1% | | | | | | | of which USA | 4.6% | 4.6% | | | | | | | Rate of increase in pensions in payment | 1.9% | 2.1% | | -1% to +1% | (5,599) | 6,713 | (5,542) | 6,657 | of which the Netherlands | 2.4% | 2.6% | | | | | | | of which UK | 2.8% | 3.0% | | | | | | | of which USA | —% | —% | | | | | | | Discount rate for pension plans | 4.1% | 4.5% | | -1% to +1% | 10,560 | (8,472) | 10,522 | (8,328) | of which the Netherlands | 3.3% | 3.7% | | | | | | | of which UK | 4.6% | 4.8% | | | | | | | of which USA | 4.9% | 5.0% | | | | | | | Inflation rate for defined benefit obligation [B] | 2.0% | 2.2% | | -1% to +1% | (6,034) | 7,300 | (6,002) | 7,271 | of which the Netherlands | 2.4% | 2.6% | | | | | | | of which UK | 2.9% | 3.1% | | | | | | | | | | | | | | | | Expected age at death for persons aged 60: | | | | | | | | | Men | 88 years | 87 years | | -1 year to +1 year | (1,166) | 1,143 | (1,130) | 1,103 | of which the Netherlands | 88 years | 88 years | | | | | | | of which UK | 87 years | 87 years | | | | | | | of which USA | 87 years | 85 years | | | | | | | Women | 89 years | 89 years | | -1 year to +1 year | (1,006) | 1,041 | (993) | 1,077 | of which the Netherlands | 90 years | 89 years | | | | | | | of which UK | 89 years | 90 years | | | | | | | of which USA | 89 years | 86 years | | | | | | | Rate of increase in health-care costs [C] | 7.0% | 6.4% | | -1% to +1% | (338) | 422 | (298) | 372 | Discount rate for health-care plans [C] | 5.6% | 5.7% | | -1% to +1% | 457 | (358) | 401 | (309) |
[A]Based on active members. [B]Excluding US funds in the weighted average inflation rate, because of the insignificant impact on the defined benefit obligation. [C]Mainly related to post-retirement health-care benefits in the USA.
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