Companies which have long since closed their finalsalary schemes to new members are watering down benefits and closing schemes to future accrual.
Few people would disagree that the disappearance of these gold-plated schemes is largely dictated by harsh economic reality.
But there are cases where the employer is citing “harsh economic reality” as an excuse for leaving staff in the lurch.
Legal & General’s response to The Pension Regulator’s consultation on the abandonment of DB schemes calls on the regulator to get much tougher on employers. It also suggests the Government should issue longevity to at least ease some of the pain by reducing deficits. If some good DB schemes can be saved, they should be.
But Scottish Life head of pensions strategy Steve Bee says the “staggering” shift from DB schemes to DC schemes also represents a massive opportunity for advisers as big corporate schemes are broken into individually managed schemes. IFAs need to take action here as this is a case of a need for good advice.