Threats to company pensions funds following business collapses, such as those of BHS and Monarch, and the renegotiation of steel workers’ future benefits, may not be isolated incidents, according to the Pensions and Lifetime Savings Association (PLSA).

A study has concluded that some three million savers currently in defined pension schemes may have as little as a 50/50 chance of receiving the payouts they were promised.

With many employers not NOW facing deficits and potentially under pressure to meet their pension obligations, the PLSA has suggested one way forward would be the pooling of resources into so-called “superfunds”  that would have bigger investment opportunities and, presumably, the chance to spread risks.

The PLSA is the trade body for the pensions industry and the new study examined the future of defined benefit schemes, including final salary pensions, currently covering 11 million people in the UK. And while the majority of final-salary schemes had a sustainable model for meeting future payouts, the PLSA says that three million savers are in schemes facing a less certain future.

Because defined benefit schemes promise savers a guaranteed level of income when they retire, they are prone to failure in their investments: while variations in the stock market and other investment vehicles see the figure varying from month to month, the total combined deficit of the UK’s 6,000 schemes is £400bn.

A spokesman for the Department for Work and Pensions said: “Most pension schemes are operating well and the vast majority of members can expect to receive their benefits in full. But in the wake of several high profile cases, there may be more that needs to be done to support the sector.

“As we look at options such as the consolidation of pension schemes, we will continue to work with the industry, employers and scheme members to see what more can be done to increase confidence in defined benefit pensions.”

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