What is done in an actuarial valuation?
The pension benefits that Members have earned in the Scheme will be paid for by one of three sources:
1) Assets in the Scheme
2) Investment returns on those assets
3) Future contributions from Tata Steel UK (to cover any actuarial deficit)
The valuation involves
a. projecting future benefit payments to Members, and then
b. discounting those payments back to a current value that we can compare with the value of the Scheme's assets.
For this purpose, the discount rate used is a prudent assessment of the expected returns on Scheme assets.
From a member benefit security perspective, you want money in the Scheme now rather than relying on (uncertain) future investment returns or additional contributions from Tata Steel UK to pay your pension. Reduced reliance on future long-term investment returns (i.e use of a lower discount rate) = improved benefit security.