Care schemes offer better option forstruggling firms

Companies struggling to maintain final salary schemes in the light of FRS17 accounting rules should switch to a career average revalued earnings (Care) basis on a modest accrual rate, according to Richard Stroud, chief executive of the Pensions Trust. This, he argues, is a much better benefit than a money purchase scheme. Employers following Stroud's advice should see two immediate benefits. First, their funding problems would be over because the more modest career average basis for the pension calculation allows employers to cap the open-ended liabilities of final salary schemes, wher...