Scheme closure will boost Aviva's net asset value by £275m

Aviva has agreed with trustees that it will close the final salary sections of the Aviva and RAC pension schemes on 31 March 2011, as proposed. The decision follows a three-month consultation that closed at the end of September.

Aviva said it had made a number of improvements to the original proposal, which was announced in April this year. These include a one-off additional company contribution of 10% of pensionable salary as at 31 March 2011, and an increase in the cap on the revaluation of final salary pension benefits based on the retail price index.

Aviva announced in April this year that the deficit from its final salary schemes had grown to £3bn from £1bn in 2006.

Closing the scheme will benefit Aviva’s net asset value by £275m and reduce funding costs by £50m a year.