The amount of actuarial provisions for post-employment benefits recognised in the financial statements results from the valuation prepared by an independent actuary.
Key actuarial assumptions related to the calculation of provisions as at the reporting date are as follows:
| As at December 31, 2021 | As at December 31, 2020 | |
|---|---|---|
| Expected inflation rate (%) | 4.45% in 2022. 3.35% in 2023. 2.5% in 2024 and in subsequent years | 2.58 in 2021. 2.5 in 2022 and in subsequent years |
| Discount rate (%) | 3.6 | 1.3 |
| Expected salary growth rate (%) | 1.36 – 2.80 | 0.0 – 3.03 |
| Employee turnover (%) | 0.2 – 9.8 | 0.0 – 15.0 |
| Expected medical care costs growth rate (%) | -22.34* w 2022 roku; 2.5% w latach kolejnych |
2.5 – 2.58 |
| Expected Social Fund (ZFŚS) allowance growth rate (%) | 4.5 – 7.27 | 0.0 – 4.0 |
*The change is mainly due to a change in medical provider.
- The probability of employees leaving was based on the Group’s historical staff turnover data
- Mortality and survival probability have been adopted from the Life Expectancy Tables published by Central Statistical Office of Poland, assuming that the population of the Group’s employees corresponds, in respect of mortality, to the average in Poland.
- A statutory mode of retirement for employees was adopted according to the detailed rules contained in the Act amending the Act on pensions from the Social Insurance Fund and certain other acts of November 16, 2016.
- A discount rate of 3.6% was used to discount future benefit payments at the reporting date (December 31, 2020: 1.3%), i.e. at the level of the yield on long-term securities issued by the State Treasury and listed on the Polish capital market.
Current book value of provisions for post-employment benefits and jubilee awards
| At December 31, 2021 | At December 31, 2020 | |||
|---|---|---|---|---|
| Non-current | Current | Non-current | Current | |
| Retirement, pension and post-mortem benefits | 462 | 101 | 557 | 105 |
| Coal subsidy | 100 | 9 | 132 | 9 |
| Energy tariff | 743 | 38 | 951 | 32 |
| Social Fund | 356 | 18 | 501 | 17 |
| Medical benefits | 54 | 4 | 71 | 4 |
| Total post-employment benefits | 1,715 | 170 | 2,212 | 167 |
| Jubilee awards | 666 | 106 | 795 | 109 |
| TOTAL ACTUARIAL PROVISIONS | 2,381 | 276 | 3,007 | 276 |
Change in provisions for employee benefits
| Retirement, pension and post-mortem benefits | Coal subsidy | Energy tariff | Social Fund | Medical benefits | Jubilee awards | Total | |
|---|---|---|---|---|---|---|---|
| AS AT JANUARY 1, 2021 | 662 | 141 | 983 | 518 | 75 | 904 | 3.283 |
| Actuarial gains and losses | 31 | (4) | 115 | 14 | (1) | 54 | 209 |
| Discount rate adjustment | (99) | (21) | (290) | (135) | (14) | (119) | (678) |
| Current employment costs | 23 | 1 | 16 | 6 | 1 | 39 | 86 |
| Past employment costs | (3) | – | (25) | (19) | – | (4) | (51) |
| Interest costs | 8 | 2 | 12 | 7 | 1 | 12 | 42 |
| Benefits paid / Provisions used | (60) | (9) | (30) | (17) | (3) | (114) | (233) |
| Sale of Group companies | (1) | – | – | – | – | – | (1) |
| Other changes | 2 | (1) | – | – | (1) | – | – |
| AS AT DECEMBER 31, 2021 | 563 | 109 | 781 | 374 | 58 | 772 | 2.657 |
| Change recognised in operating expenses | (20) | (1) | 9 | 13 | (1) | 30 | 30 |
| Change recognised in finance income/(costs) | (8) | (2) | (12) | (7) | (1) | (12) | (42) |
| Change recognised in other comprehensive income | 68 | 25 | 175 | 121 | 15 | – | 404 |
| Retirement, pension and post-mortem benefits | Coal subsidy | Energy tariff | Social Fund | Medical benefits | Jubilee awards | Total | |
|---|---|---|---|---|---|---|---|
| AS AT JANUARY 1, 2020 | 660 | 148 | 832 | 442 | 67 | 917 | 3,066 |
| Actuarial gains and losses | (8) | (6) | 33 | 22 | 3 | (4) | 40 |
| Discount rate adjustment | 33 | 8 | 97 | 48 | 5 | 40 | 231 |
| Current employment costs | 30 | 1 | 26 | 13 | 2 | 49 | 121 |
| Past employment costs | (9) | – | 6 | (5) | (1) | (1) | (10) |
| Interest costs | 13 | 3 | 17 | 9 | 1 | 18 | 61 |
| Benefits paid / Provisions used | (58) | (8) | (27) | (17) | (3) | (115) | (228) |
| Other changes | 1 | (5) | (1) | 6 | 1 | – | 2 |
| AS AT DECEMBER 31, 2020 | 662 | 141 | 983 | 518 | 75 | 904 | 3,283 |
| Change recognised in operating expenses | (21) | (1) | (32) | (8) | (1) | (84) | (147) |
| Change recognised in finance income/(costs) | (13) | (3) | (17) | (9) | (1) | (18) | (61) |
| Change recognised in other comprehensive income | (25) | (2) | (130) | (70) | (8) | – | (235) |
Sensitivity analysis of the value of actuarial provisions as at December 31, 2021, for changes in key assumptions:
| Carrying amount | Discount rate | Expected average growth rate of the basis of calculation | |||
|---|---|---|---|---|---|
| -1 p.p. | + 1 p.p. | -1 p.p. | + 1 p.p. | ||
| Retirement, pension and post-mortem benefits | 563 | 40 | (34) | (35) | 40 |
| Coal subsidy | 109 | 9 | (7) | (8) | 10 |
| Energy tariff | 781 | 104 | (85) | (87) | 106 |
| Social Fund | 374 | 45 | (39) | (40) | 46 |
| Medical benefits | 58 | 5 | (5) | (5) | 5 |
| Jubilee awards | 772 | 49 | (43) | (44) | 49 |
| TOTAL | 2,657 | 252 | (213) | (219) | 256 |