Friday, 22 February 2008

More bad news for DB schemes

Even those employers still sticking with DB are losing faith. The future is DC I'm afraid, no question about it:

Half of employers considering wisdom of continuing DB

by Jonathan Stapleton 21-02-2008

Half of all employers believe the cost of running a defined benefit scheme is now disproportionate to the value it provides, new research shows.

Buck Consultants’ fifth annual Key Pension Issues Survey found 50pc of the 123 respondents believed their pension scheme was too cumbersome and felt the alternative of giving employees money directly or through a defined contribution scheme was becoming more attractive.

More than a quarter (28pc) of respondents had considered inducement deals for members to transfer out and 33pc had considered buying out their liabilities.

And nearly three-quarters of respondents (72pc) said they were less optimistic about the future for employer-sponsored pension schemes than last year.

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