Final salary pension schemes in decline

Posted on 28th February 2012

More and more private final salary pension schemes are closing to new members. Only 16% are still accepting members, according to the Pension Protection Fund (PPF) and the Pensions Regulator’s “Purple Book” survey.

Just as concerning was their finding that 24% of existing schemes had stopped their current members from increasing their funds. Although the review gave a slightly more positive picture than other, less detailed reports carried out in the past year, the PPF and the Regulator are less than optimistic about the future.

The PPF provides backup for pension scheme members when an employer collapses, leaving the scheme with a significant deficit. The Purple Book cautions that “…since [the end of March 2011] there has been a slowdown in the global and UK economies and this could have a negative impact on the [Pension Protection Fund].”

Have you re-examined your pension provisions lately?

Chris Taylor, Managing Director

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