Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Latest NewsPay & benefitsPensions

End of road for defined benefit pension plans?

by Michael Millar 18 Apr 2006
by Michael Millar 18 Apr 2006

The creation of a new company offering organisations the chance to “divorce their pension schemes” could herald the death knell for final salary (or defined benefit) pensions, industry experts have warned.

Insurance company Paternoster will buy defined benefit scheme liabilities from companies, freeing them from expensive pensions obligations.
Pension Commission figures show the number of defined benefit schemes open to new members has dropped from five million in 1995 to 1.5 million today.

Two insurance companies – Prudential and Legal & General – already offer a similar service, but the creation of Paternoster shows increasing levels of interest in the concept. At least two further companies offering to buy liabilities are in development.

Mark Wood, chief executive of Paternoster, said the corporate defined pension market had historically been overlooked and under-served, and the company would give a “much needed solution” to organisations, trustees and current and future pensioners.

But rather than save defined benefit schemes, Paternoster’s service is more likely to be “the nail in the coffin” of future funds, according to David Robbins, pensions partner at professional services firm Deloitte.

“There is hardly a boardroom in the UK that wouldn’t like to get rid of its obligation to manage schemes,” he said. “If they give their defined benefit schemes to a company like Paternoster, any new scheme they offer will almost certainly be defined contribution in nature.”

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

Wood, previously head of Prudential’s UK insurance operation, agreed this could well be the case. He added that more and more companies would consider transferring their liabilities so they could not be forced to pay into the Pension Protection Fund levy.

Paternoster aims to get Financial Services Authority accreditation by the autumn, and then it can begin buying pension funds. The company has already secured £500m of capital from a consortium led by Deutsche Bank.

Michael Millar

previous post
Law firm sets bold precedent with new inclusivity manager
next post
Union fury over ID cards for London Underground workers

You may also like

Number of Neet women rises but figures fall...

23 May 2025

Sighing in frustration at colleague was discriminatory, judge...

23 May 2025

Unions ponder strike action after public sector pay...

23 May 2025

Fire and rehire: the relocation question

22 May 2025

Public sector workers gain pay rises of up...

22 May 2025

Six ways to kickstart conversations about team stress...

22 May 2025

UK net migration slashed by half in one...

22 May 2025

How neuroscience can unlock employee recognition

22 May 2025

UK universities fret over fall in international students

22 May 2025

HSBC employees warned of office attendance link to...

22 May 2025

  • 2025 Employee Communications Report PROMOTED | HR and leadership...Read more
  • The Majority of Employees Have Their Eyes on Their Next Move PROMOTED | A staggering 65%...Read more
  • Prioritising performance management: Strategies for success (webinar) WEBINAR | In today’s fast-paced...Read more
  • Self-Leadership: The Key to Successful Organisations PROMOTED | Eletive is helping businesses...Read more
  • Retaining Female Talent: Four Ways to Reduce Workplace Drop Out PROMOTED | International Women’s Day...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+