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Post employment benefits (Tables)
12 Months Ended
Jun. 30, 2022
Disclosure of defined benefit plans [abstract]  
Schedule of funding valuations of the significant defined benefit plans
The most recent funding valuations of the significant defined benefit plans were carried out as follows:
Principal plans
Date of valuation
United Kingdom(1)
1 April 2021
Ireland(2)
31 December 2018
United States
1 January 2021
(1)    The Diageo Pension Scheme (DPS) closed to new members in November 2005. Employees who joined Diageo in the United Kingdom between November 2005 and January 2018, had been eligible to become members of the Diageo Lifestyle Plan (a cash balance defined benefit plan). Since then, new employees have been eligible to become members of a Diageo administered defined contribution plan.
(2)    The Irish scheme closed to new members in May 2013. Employees who have joined Diageo in Ireland since the defined benefit scheme closed have been eligible to become members of Diageo administered defined contribution plans. The triennial valuation of the Guinness Ireland Group Pension Scheme in Ireland (the Irish Scheme) is in progress and the results of this valuation are expected to be agreed by Diageo and the trustee later in calendar year 2022.
Schedule of amounts charged to consolidated income statement for group's defined benefit post employment plans and consolidated statement of comprehensive income
The amounts charged to the consolidated income statement and statement of comprehensive income for the group’s defined benefit plans for the three years ended 30 June 2022 are as follows:
 2022
£ million
2021
£ million
2020
£ million
Current service cost and administrative expenses(107)(105)(109)
Past service gains – ordinary activities34 — 50 
Past service losses – exceptional (5)— 
Gains on curtailments and settlements34 18 12 
Charge to operating profit(39)(92)(47)
Net finance gain in respect of post employment plans10 
Charge before taxation(1)
(29)(87)(38)
Actual returns less amounts included in finance income(1,432)(6)774 
Experience (losses)/gains(35)80 34 
Changes in financial assumptions2,133 125 (754)
Changes in demographic assumptions(40)(183)(14)
Other comprehensive income626 16 40 
Changes in the surplus restriction(11)— (2)
Total other comprehensive income
615 16 38 
(i) The year ended 30 June 2022 includes settlement gains of £27 million in respect of the Enhanced Transfer Values exercise carried out in the Irish Schemes and past service gains of £28 million as a result of the changes of the benefits in the Irish Scheme. In the year ended 30 June 2021, the exceptional past service loss of £5 million is in respect of the equalisation of Guaranteed Minimum Pension (GMP) benefits for men and women). The year ended 30 June 2020 includes a past service gain of £47 million in respect of the Irish Scheme following communications to the deferred members in respect of changing their expectations of a full pension prior to reaching the age of 65 and to pensioners in respect of future pension increases.
Schedule of charge before taxation
(1)     The (charge)/income before taxation is in respect of the following countries:
2022
£ million
2021
£ million
2020
£ million
United Kingdom
(27)(46)(23)
Ireland
45 34 
United States
(31)(28)(30)
Other
(16)(17)(19)
(29)(87)(38)
Schedule of movement in net deficit
The movement in the net surplus for the two years ended 30 June 2022 is set out below:
 Plan
assets
£ million
Plan
liabilities
£ million
Net
surplus
£ million
At 30 June 202010,422 (10,057)365 
Exchange differences
(214)245 31 
Charge before taxation(1)
149 (236)(87)
Other comprehensive income/(loss)(2)
(6)22 16 
Contributions by the group
122 — 122 
Settlements paid(3)
(169)169 — 
Employee contributions
(4)— 
Benefits paid
(416)416 — 
At 30 June 20219,892 (9,445)447 
Exchange differences
93 (100)(7)
Charge before taxation(1)
176 (205)(29)
Other comprehensive income/(loss)(2)
(1,432)2,058 626 
Contributions by the group
128  128 
Settlements paid(3)
(52)52  
Employee contributions
5 (5) 
Benefits paid
(411)411  
At 30 June 20228,399 (7,234)1,165 
(1) Includes net settlement gain of £27 million (F21 - £14 million) and past service gain of £28 million.
(2) Excludes surplus restriction.
(3) Includes settlement payment of £52 million on ETV exercise in Ireland (F21 – £151 million in respect of a settlement in the US Cash Balance plan).
Schedule of plan assets and liabilities by type of post employment benefit and country
The plan assets and liabilities by type of post employment benefit and country is as follows:

 20222021
 Plan
assets
£ million
Plan
liabilities
£ million
Plan
assets
£ million
Plan
liabilities
£ million
Pensions
United Kingdom
6,041 (4,897)7,341 (6,580)
Ireland
1,645 (1,409)1,826 (1,926)
United States
453 (408)470 (373)
Other
191 (212)186 (225)
Post employment medical
2 (225)(262)
Other post employment
67 (83)67 (79)
8,399 (7,234)9,892 (9,445)
Schedule of balance sheet analysis of post employment plans
The balance sheet analysis of the post employment plans is as follows:
 20222021
 
Non-
current
assets
(1)
£ million
Non-
current
liabilities
£ million
Non-
current
assets
(1)
£ million
Non-
current
liabilities
£ million
Funded plans
1,553 (144)1,018 (279)
Unfunded plans
 (258)— (295)
1,553 (402)1,018 (574)
(1)    Includes surplus restriction of £14 million (2021 – £3 million).
Schedule of weighted average assumptions used to determine group's deficit/surplus in main post employment plans
The following weighted average assumptions were used to determine the group’s deficit/surplus in the main post employment plans at 30 June in the relevant year. The assumptions used to calculate the charge/credit in the consolidated income statement for the year ending 30 June are based on the assumptions disclosed as at the previous 30 June.
 United KingdomIreland
United States(1)
 2022%2021%2020%2022%2021%2020%2022%2021%2020%
Rate of general increase in salaries(2)
3.6 3.4 3.2 3.8 3.0 2.6  — — 
Rate of increase to pensions in payment
2.9 3.1 3.0 2.2 1.7 1.4  — — 
Rate of increase to deferred pensions
2.6 2.5 2.1 2.3 1.6 1.2  — — 
Discount rate for plan liabilities
3.8 1.9 1.5 3.2 1.0 1.2 4.4 2.7 2.6 
Inflation – CPI
2.6 2.5 2.1 2.4 1.6 1.2 2.3 2.3 1.4 
Inflation - RPI
3.1 3.0 2.8  — —  — — 
(1)    The salary increase assumption in the United States is not a significant assumption as only a minimal amount of members’ pension entitlement is dependent on a member’s projected final salary.
(2)    The salary increase assumptions include an allowance for age-related promotional salary increases.
Schedule of expected age at death of an average worker who retires currently at age of 65, and one who is currently aged 45 and subsequently retires at the age of 65
For the principal UK and Irish pension funds, the table below illustrates the expected age at death of an average worker who retires currently at the age of 65, and one who is currently aged 45 and subsequently retires at the age of 65:
 
United Kingdom(1)
Ireland(2)
United States
 2022
Age
2021
Age
2020
Age
2022
Age
2021
Age
2020
Age
2022
Age
2021
Age
2020
Age
Retiring currently at age 65
Male
87.187.286.487.786.986.685.585.485.6
Female
88.788.788.790.089.389.387.287.187.3
Currently aged 45, retiring at age 65
Male
88.588.688.589.388.689.687.086.987.2
Female
90.790.890.891.791.192.388.688.588.9
(1)    Based on the CMI’s S3 mortality tables with scaling factors based on the experience of the plan and where people live, with suitable future improvements.
(2)    Based on the CMI's S3 mortality tables with scaling factors based on the experience of the plan, with suitable future improvements.
Schedule of sensitivity analyses of potential impacts on consolidated income statement and on plan liabilities
For the significant assumptions, the following sensitivity analyses estimate the potential impacts on the consolidated income statement for the year ending 30 June 2023 and on the plan liabilities at 30 June 2022:
 
United Kingdom
Ireland
United States
Benefit/(cost)
Operating
profit
£ million
Profit after
taxation
£ million
Plan
liabilities
(1)
£ million
Operating
profit
£ million
Profit after
taxation
£ million
Plan
liabilities
(1)
£ million
Operating
profit
£ million
Profit after
taxation
£ million
Plan
liabilities
(1)
£ million
Effect of 0.5% increase in discount rate
2 19 336 1 4 96 1 3 22 
Effect of 0.5% decrease in discount rate
(3)(17)(374)(1)(4)(108)(1)(3)(23)
Effect of 0.5% increase in inflation
(2)(9)(246)(1)(3)(59) (1)(10)
Effect of 0.5% decrease in inflation
2 10 260 1 3 57  1 9 
Effect of one year increase in life expectancy
 (6)(171) (2)(56) (1)(17)
 
(1)    The estimated effect on the liabilities excludes the impact of any interest rate and inflation swaps held by the pension plans.
(i)    The sensitivity analyses above have been determined based on reasonably possible changes of the respective assumptions and may not be representative of the actual change. Each sensitivity is calculated on a change in the key assumption while holding all other assumptions constant. The sensitivity to inflation includes the impact on all inflation linked assumptions (e.g. pension increases and salary increases where appropriate).
Schedule of analysis of fair value of plan assets
An analysis of the fair value of the plan assets is as follows:
2022
United Kingdom
£ million
Ireland
£ million
United States and other
£ million
Total
£ million
QuotedUnquotedQuotedUnquotedQuotedUnquotedQuotedUnquotedTotal
Equities23 1,218 — 319 70 105 93 1,642 1,735 
Bonds
Fixed-interest government86 — 30 49 152 51 268 319 
Inflation-linked government— — — 199 200 201 
Investment grade corporate— 68 — 388 25 222 25 678 703 
Non-investment grade44 557 200 47 758 805 
Loan securities11 1,271 — 98 — — 11 1,369 1,380 
Repurchase agreements2,400 (215)— — — — 2,400 (215)2,185 
Liability Driven Investment (LDI)— 119 — 46 — — — 165 165 
Property28 716 — 74 — 28 791 819 
Hedge funds— 107 — 92 — — 204 204 
Interest rate and inflation swaps— (900)— 37 — — — (863)(863)
Cash and other24 481 154 — 80 31 715 746 
Total bid value of assets2,532 3,508 9 1,637 146 567 2,687 5,712 8,399 

2021
United Kingdom
£ million
Ireland
£ million
United States and other
£ million
Total
£ million
QuotedUnquotedQuotedUnquotedQuotedUnquotedQuotedUnquotedTotal
Equities
— 604 306 70 106 72 1,016 1,088 
Bonds
Fixed-interest government86 61 — 81 47 133 146 279 
Inflation-linked government— — — 239 — — — 239 239 
Investment grade corporate13 499 — 355 24 367 37 1,221 1,258 
Non-investment grade17 134 115 10 21 259 280 
Loan securities58 1,731 278 — — 59 2,009 2,068 
Repurchase agreements4,512 (904)— — — — 4,512 (904)3,608 
Liability Driven Investment (LDI)210 — 66 — — 276 278 
Property— 685 — 72 — — 758 758 
Hedge funds— 101 — 139 — — 244 244 
Interest rate and inflation swaps— (994)— 108 — — — (886)(886)
Cash and other12 514 60 — 90 14 664 678 
Total bid value of assets
4,700 2,641 7 1,819 143 582 4,850 5,042 9,892 
(i)    The asset classes include some cash holdings that are temporary. This cash is likely to be invested imminently and so has been included in the asset class where it is anticipated to be invested in the long-term.
Schedule of timing of benefit payments
The following table provides information on the timing of the benefit payments and the average duration of the defined benefit obligations and the distribution of the timing of benefit payments:
 
United Kingdom
Ireland
United States
 2022
£ million
2021
£ million
2022
£ million
2021
£ million
2022
£ million
2021
£ million
Maturity analysis of benefits expected to be paid
Within one year
295 288 70 84 58 52 
Between 1 to 5 years
1,082 1,112 353 338 187 145 
Between 6 to 15 years
2,556 2,606 704 656 310 247 
Between 16 to 25 years
2,252 2,314 634 588 183 145 
Beyond 25 years
2,787 2,840 768 746 174 138 
Total
8,972 9,160 2,529 2,412 912 727 
years
years
years
years
years
years
Average duration of the defined benefit obligation
15181518911