Conditions for final salary schemes will be tough in 2017.
The future of the schemes has been highlighted this year with the collapse of BHS and the future or steelworkers’ retirement deals.
The Pension Protection Fund said that the collective deficit of the UK’s 5,794 final salary schemes was £222bn at the end of March, little changed from a year earlier. One of the major concerns of final salary schemes is that people are living longer meaning the companies have to pay out or longer thus making the scheme more expensive. Another major concern is the uncertainty in the economy. Pensions schemes rely on the employer’s contributions to be successfully invested.
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