Rate of closure of final salary pension schemes slows

The rate at which final salary pension schemes are closing to new members slowed dramatically in the 2004-05 tax year, official figures have shown.

A total of 83 final salary schemes closed to new members that year, the Pensions Regulator said, compared with 126 and 242 in the previous two years.

Experts said the falls reflected the fact that many employers had already closed or wound up their schemes.

Final salary pensions offer employees a fixed percentage of their salary when they retire, but they can be expensive for employers.

Mounting costs combined with stockmarket underperformance has, in recent years, prompted many employers to close the schemes to new members.

“The rate of closure may be slowing but this merely reflects the fact that many employers have already taken the step,” Malcolm McLean, chief executive of the Pensions Advisory Service, told BBC News.

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