The High Court made a clear ruling regarding pensions yesterday. Trustees of underfunded pension schemes may not now exploit the Pension Protection Fund in order to protect the pensions of high earners.
The judge, Justice Henderson, made a strong rejection of pension fund trustee attempts to buy annuities for members that would cover additional benefits higher than those already guaranteed by the PPF.
Wealth policy director at Legal and General, Adrian Boulding, made it clear that high earners should transfer out of their defined benefit schemes if they become worried about their employer. He reportedly said: "The higher earners at Ilford Imaging waited too long before trying to protect their money. If you have large benefits, you have to transfer out of the scheme before the company goes into administration. The PPF only covers around £28,000 but some people have built up benefits worth significantly more than that and if their firm goes bust they will lose out."
Court makes pension decision
Financial Services
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Court makes pension decision
Wed, 11 Nov 2009
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