Funding position means 20% only get half their pension

According to Mercer Human Resource Consulting, scheme members could be in for a shock when they receive their first summary funding statements from the trustees of their scheme. Most schemes are legally required to send statements explaining the funding position of their scheme by 22 September as part of the Pensions Act 2004, and they have to show the ‘ongoing’ funding basis set by trustees, as well as the full insurance ‘buy-out’ basis. And although a scheme could be 100% funded on an ‘ongoing’ basis, Mercer warns this would only equate to a 60% funding level on an insurance ‘buy-out’...