MPA - statement of accounts

48Notes to the Financial StatementsNotes to the Police Officer Pension Fund AccountThe Police Officer Pension Fund combines theaccounting transactions of two pensions schemes forMetropolitan Police Officers. These are the PolicePension Scheme, which was set up in 1987 and theNew Police Pension Scheme, which was created bythe Home Office under the Police PensionsRegulations 2006.The Police Officer Pension Fund which is managed bythe Metropolitan Police Authority has been set up forthe specific purpose of administering the collection ofcontributions, the payment of pensions and paymentor refund to central government for the balanceoutstanding for each year. The Fund does not hold anyinvestment assets nor does it reflect the liabilities ofboth Schemes to pay present and future pensioners.The fund will be paid sufficient monies from the HomeOffice in 2008-09 to cover the deficit in year.These accounts have been prepared using CIPFA’sPension SORP and the SORP principles adopted forthe statements of the MPA. These financial statementsdo not take account of liabilities to pay pensions andother benefits after the period end. The principlescontained in the Police Pension Fund Regulations2007 have been adopted prior to theircommencement.Details of the accounting policies of the MPA can beseen on page 18 to 22. The MPA administers the Fundthrough its accounting and banking systems. Detailsof the two Schemes’ actuarial report can be seen onpage 43 in the notes to the balance sheet. The cost ofpensions can be seen on page 28 in note 5 to theincome and expenditure account.3. Additional incomeThese consist of MPA income for ill health retirements,30 plus scheme contributions and refund of formercommissioners and widows pensions.4. Employer additional fundingThis sum represents additional funding required toprovide for payment to pensioners. It representsadditional funding of £17.7 million received by theMPS in 2007-08 and a statutory transfer from thepolice fund in respect of a further sum of £15.7 millionto be received in 2008-09. Both sums being paid bythe Home Office.5. TransfersThese represent lumps sums transferred to and fromother pensions schemes depending on whether thepolice officer was joining or leaving the MPS.6 Other paymentsThese consist of contribution equivalent payments,superannuation refunds and lump sum death benefits.7. Related party transactionsAs previously stated the Fund is administered solelyby the MPS and as such this organisation is the onlyrelated party to the Fund, thus all the transactionsshown on the revenue statement having beenprocessed through the MPS.8. Additional Voluntary Pension ContributionsAdditional pension contributions (e.g. added years)made by Police Officers amounted to £50,901. (2006-07 £60,755).These accounts are audited by the Audit Commissionand their opinion is included in that of the MPA onpage 8.Revenue Account Notes1. Employer contributionsEmployer contributions are calculated at 24.6% ofpolice officer pensionable pay.2. Officer contributionsContributions by officers are deducted from officerwages at a rate of 11% of pensionable pay.9. Members of the SchemeThe Pension Fund also administers pensions on behalfof members of Her Majesty’s Inspectorate ofConstabulary. There are 4 HMIC staff who are workingmembers of the scheme and 20 HMIC pensioners and6 dependants pensioners.10. Asset Statement notesThe new Home Office circular issued in June 2008requires additional lump sums payable under the PPSto officers who retired after 30 September 2007 andchose to take a lump sum. The additional lump sum isshown as a current liability in the police pension fundasset statement, with a corresponding amount shownas a current asset.