At 31 December 2019, EDF Energy’s EEGSG and BEGG pension schemes (see note 1.3.21.2.2) were overfunded to the extent of €1,246 million compared to €937 million at 31 December 2018.
The surplus funding, which has increased due to the good performance by fund assets, is recognised in balance sheet assets as “non-current financial assets”.
EDF Energy also recorded a €224 million provision in respect of its EEPS pension scheme at 31 December 2019, compared to €146 million at 31 December 2018.
| (in millions of euros) | 2019 | 2018 |
|---|---|---|
| Current service cost | Current service cost 2019 (230) | Current service cost 2018 (258) |
| Past service cost | Past service cost 2019 - | Past service cost 2018 (15) |
| Actuarial gains and losses – other long-term benefits | Actuarial gains and losses – other long-term benefits 2019 - | Actuarial gains and losses – other long-term benefits 2018 - |
| Net expenses recorded as operating expenses | Net expenses recorded as operating expenses 2019 (230) | Net expenses recorded as operating expenses 2018 (273) |
| Interest expense (discount effect) | Interest expense (discount effect) 2019 (243) | Interest expense (discount effect) 2018 (232) |
| Return on fund assets | Return on fund assets 2019 263 | Return on fund assets 2018 248 |
| Net interest expense included in financial result | Net interest expense included in financial result 2019 20 | Net interest expense included in financial result 2018 16 |
| EMPLOYEE BENEFIT EXPENSES RECORDED IN THE INCOME STATEMENT | EMPLOYEE BENEFIT EXPENSES RECORDED IN THE INCOME STATEMENT 2019 (210) | EMPLOYEE BENEFIT EXPENSES RECORDED IN THE INCOME STATEMENT 2018 (257) |
| Actuarial gains and losses – post-employment benefits | Actuarial gains and losses – post-employment benefits 2019 (873) | Actuarial gains and losses – post-employment benefits 2018 518 |
| Actuarial gains and losses on fund assets | Actuarial gains and losses on fund assets 2019 998 | Actuarial gains and losses on fund assets 2018 (463) |
| Actuarial gains and losses | Actuarial gains and losses 2019 125 | Actuarial gains and losses 2018 55 |
| Translation adjustments | Translation adjustments 2019 47 | Translation adjustments 2018 (6) |
| GAINS AND LOSSES ON EMPLOYEE BENEFITS RECORDED DIRECTLY IN EQUITY | GAINS AND LOSSES ON EMPLOYEE BENEFITS RECORDED DIRECTLY IN EQUITY 2019 172 | GAINS AND LOSSES ON EMPLOYEE BENEFITS RECORDED DIRECTLY IN EQUITY 2018 49 |
| (in millions of euros) | 31/12/2019 | 31/12/2018 |
|---|---|---|
| Current employees | Current employees 31/12/2019 5,202 | Current employees 31/12/2018 4,948 |
| Retirees | Retirees 31/12/2019 4,488 | Retirees 31/12/2018 3,300 |
| OBLIGATIONS | OBLIGATIONS 31/12/2019 9,690 | OBLIGATIONS 31/12/2018 8,248 |
Pension obligations in the United Kingdom are partly covered by external funds with a present value of €10,712 million at 31 December 2019 (€9,039 million at 31 December 2018).
The investment strategy applied in these funds is a liability driven investment strategy. The allocation between growth and back-to-back is regularly reviewed by the trustees, at least after every actuarial valuation, to ensure that the funds’ overall investment strategy remains coherent in order to achieve the target coverage level required.
These assets break down as follows:
| (in millions of euros) | 31/12/2019 | 31/12/2018 |
|---|---|---|
| BEGG pension fund | BEGG pension fund 31/12/2019 8,144 | BEGG pension fund 31/12/2018 6,963 |
| EEGSG pension fund | EEGSG pension fund 31/12/2019 1,493 | EEGSG pension fund 31/12/2018 1,267 |
| EEPS pension fund | EEPS pension fund 31/12/2019 1,075 | EEPS pension fund 31/12/2018 809 |
| FUND ASSETS | FUND ASSETS 31/12/2019 10,712 | FUND ASSETS 31/12/2018 9,039 |
| Comprising (%) | ||
| Listed equity instruments (shares) | Listed equity instruments (shares) 31/12/2019 11% | Listed equity instruments (shares) 31/12/2018 9% |
| Listed debt instruments (bonds) | Listed debt instruments (bonds) 31/12/2019 57% | Listed debt instruments (bonds) 31/12/2018 61% |
| Real estate properties | Real estate properties 31/12/2019 7% | Real estate properties 31/12/2018 8% |
| Cash and cash equivalents | Cash and cash equivalents 31/12/2019 2% | Cash and cash equivalents 31/12/2018 3% |
| Other | Other 31/12/2019 23% | Other 31/12/2018 19% |
