29 Pension obligations

The company has in its operating countries several defined contribution pension plans which are subject to local regulation and practices. The company’s one most significant pension plan is the Finnish Employees Pensions Act (TyEL), in which the benefits are determined directly on the basis of the level of the beneficiary’s earnings level. TyEL pension plan is mainly arranged through pension insurance companies and it is treated as a defined contribution plan.

At the end of 2015, the company had defined benefit pension plans only in Finland. The plans at the year-end 2015 were final salary defined benefit plans, and they supplement the statutory pensions or enable retirement before the statutory retirement age. The company’s last two defined benefit pension plans in Norway were terminated during 2015.

EUR million

31 Dec 2016 (forecast) 31 Dec 2015 31 Dec 2014
Recognised in the statement of financial position


Present value of funded obligations

0.2 0.2 0.6

Fair value of plan assets

-0.1 -0.1 -0.1

Total amount recognised in the statement of financial position

0.1 0.1 0.6


of which in Finland

0.1 0.1 0.5


of which in Norway



0.0








Company estimates that in 2016 it will not make any payments with material impact. Estimate may vary from actual figures.


EUR million Present value of obligation Fair value of plan assets Total
1 Jan 2015
0.6
-0.1 0.6
Current service cost
0.0

0.0
Net interest
0.0
0.0 0.0
Curtailments
0.0

0.0




0.0
0.0 0.0
Remeasurements




Return on plan assets

0.0 0.0

(Gain)/loss from change in financial assumptions -0.4

-0.4

Experience (gains)/losses 0.0

0.0



-0.4
0.0 -0.4
Employer contributions

0.0 0.0
Benefit payments 0.0
0.0
31 Dec 2015 0.2
-0.1 0.1








EUR million Present value of obligation Fair value of plan assets Total
1 Jan 2014 1.0
-0.1 0.9
Current service cost 0.0

0.0
Net interest 0.0
0.0 0.0
Settlements 0.0
0.0
Curtailments -0.2

-0.2



-0.2
0.0 -0.2
Remeasurements




Return on plan assets

0.0 0.0

(Gain)/loss from change in financial assumptions -0.2

-0.2

Experience (gains)/losses
0.1

0.1



0.0
0.0 0.0
Exchange differences 0.0
0.0 0.0
Employer contributions

0.0 0.0
Benefit payments 0.0
0.0
Business combinations and disposals
-0.1

-0.1
31 Dec 2014 0.6
-0.1 0.6








The company's defined benefit pension obligations do not include minimum funding requirements.






31 Dec 2015 Finland 31 Dec 2014 Finland 31 Dec 2014 Norway
Actuarial assumptions





Discount rate, %

2.7 2.5 3.0

Inflation rate, %

1.2 2.0 1.8

Expected rate of salary increases, %

1.0 1.0 3.0

Future pension increases, %

1.4 2.1 2.3













31 Dec 2015 Finland 31 Dec 2014 Finland 31 Dec 2014 Norway
Life expextancy of plan members





Male age 65 (current life expectancy), years

21.4 19.0 20.6

Female age 65 (current life expectancy), years

25.4 24.7 23.5

Male age 45 (at age 65), years

23.7 20.6 22.8

Female age 45 (at age 65), years

28.0 26.4 26.0








Defined benefit plans’ assets consist entirely of qualifying insurance policies and are fair valued on the accounting date. These assets do not include investments to Lemminkäinen or to real estate or other assets used by the company. The expected return on the plan assets is an estimate of a life insurance company's future long term total rebate.


Plan participants at the end of period 31 Dec 2015 31 Dec 2014
Active
4 6
Inactive not in pay status / other non-work obligated
7 9
Inactive in pay status / Pensioners
84 91
Total number of participants
95 106

The effect of a 0.5 percentage point change in the most significant actuarial assumptions to the amount of defined benefit pension obligations is presented in the tables below.







31 Dec 2015 Finland 31 Dec 2014 Finland 31 Dec 2014 Norway
0.5% increase in the principal assumption will impact the liability as follows



Discount rate, %

-4.20 -4.76 -0.33

Inflation rate, %

109.20 55.41

Expected rate of salary increases, %

0.58 0.24 0.01








0.5% decrease in the principal assumption will impact the liability as follows





Discount rate, %

4.60 5.22 0.33

Inflation rate, %

-70.20 -35.66

Expected rate of salary increases, %

-0.58 -0.24 -0.01








The above analyses are based on a 0.5 percentage point change in an assumption while holding all other assumptions constant. When calculating the sensitivity of the defined benefit pension obligation the same method has been applied as when measuring the defined benefit pension obligation recognized in the statement of financial position.


EUR million 2015 2014 2013 2012 2011
Plan assets and liabilities for the past five years

Defined benefit obligation 0.2 0.6 1.0 19.0 21.7

Fair value of plan assets -0.1 -0.1 -0.1 -13.8 -13.4


0.1 0.6 0.9 5.2 8.3