Deficit Recovery Plan

What are the issues?

Due to poor investment performance over recent years and, in some instances, poor funding levels, many final salary pension schemes are now in deficit. This position is causing Finance Directors sleepless nights because they are being asked to pay substantial contributions to the pension scheme to redress the funding position in the scheme. Furthermore, the deficit is shown on balance sheet (a requirement of FRS17). The Deficit Recovery Plan allows this deficit to be moved ‘off balance sheet’.

What is the Deficit Recovery Plan?

The Deficit Recovery Plan will take your pension deficit ‘off balance sheet’. This is achieved by undertaking a full analysis of the scheme funding position and setting out the full options available. One of the options is to invest scheme assets in an investment vehicle which will provide a guaranteed rate of return over a given period of time. This will improve the risk based part of the Pension Protection Fund levy. This will also help to improve the security of the benefits for members of the pension scheme.

This is an innovative approach to funding issues which may be the solution for your scheme. All necessary issues with The Regulator are also managed for you.