Pension scheme funding

The challenge for employers and trustees

Employers with defined benefit pension schemes face the ongoing challenge of funding their past service pension liabilities. Making good these historic deficits can place a significant strain on employers. Trustees are required to ensure that their scheme meets the statutory funding objective and, ultimately, that it will have sufficient assets to pay members' benefits.

Every three years trustees and employers are required to review their scheme's funding position and put in place appropriate funding arrangements to address any deficit in the scheme. This can be a time-consuming and challenging process and it is vital that trustees and employers receive expert and pragmatic legal advice.

How we can help

Our team has a great deal of experience advising trustees and employers in the context of pension scheme funding negotiations. We guide our clients through the funding process and provide ongoing advice on funding and employer covenant issues. We are experienced in dealing with the Pensions Regulator and we have implemented several innovative funding solutions, including asset-backed contributions, which have enabled our clients to agree more flexible recovery plans, whilst also improving security for members.

Areas of expertise

• helping trustees and employers to reach agreement on funding matters and to put in place appropriate funding arrangements for their scheme.
• dealing with the Pensions Regulator.
• implementing innovative funding solutions to improve members' security and to help employers fund their scheme.
• advising on employer covenant and the use of contingent assets.