Solely 4% of DB pension schemes nonetheless open to new members

One in 20 (4%) outlined profit (DB) pension schemes remained open to new members in 2023, new knowledge revealed right now by The Pensions Regulator (TPR) reveals.

The 199 schemes had a mixed membership of 1.2 million savers.

A fifth of DB schemes (20%), with complete membership of two.7 million, remained open to future accrual for his or her present members.

Seven in ten (72%) schemes had been closed to future accrual and the remaining 4% of schemes had been within the means of winding up.

The information was revealed in TPR’s annual DB Panorama publication which offers an outline of the occupational DB and hybrid pension panorama within the UK, reporting on scheme standing, membership ranges and property beneath administration.

The report confirmed that scheme funding ranges have improved since 2022. The variety of schemes with 100% or higher technical provision funding ranges elevated from 2,565 to three,620. And the entire deficit (of schemes in deficit) has greater than halved, decreasing from £63bn to £28bn.

As in earlier years, the DB panorama continued to shrink, TPR identified. Since 2022, the entire variety of schemes has diminished by 2%, from 5,378 to five,297.

Lou Davey, TPR’s interim director of regulatory coverage, evaluation and recommendation, mentioned: “As we speak’s report provides an essential overview of the DB panorama, which has greater than 9.6 million memberships. Modifications in scheme standing have been small year-on-year however the pattern of a contracting market continues.”

Helen Morrissey, head of retirement evaluation at Hargreaves Lansdown, mentioned: “The endgame for outlined profit schemes creeps ever nearer, with lower than 200 personal schemes nonetheless open to new members in 2023. DB schemes had been as soon as widespread, however the decline has set in, and they’re now properly and really the endangered species of the pension panorama.”

The TPR mentioned it has reviewed how knowledge for the annual report is gathered and analysed, leading to notable adjustments to a few of its figures. Historic knowledge for the report has additionally been reviewed and, the place needed, revised.

Knowledge for the report is given to TPR by trustees and directors of their annual scheme returns.

In line with analysis from pensions consultancy XPS Pensions Group revealed final month, the tip of 2023 noticed the speed of individuals transferring out of their DB pension fall to a five-year low. Its Switch Exercise Index noticed a gradual downward pattern throughout the yr till, by the tip of December, the tracker registered an annualised charge of 18 members in each 1,000 transferring their advantages to different preparations.

• The information used to supply TPR’s official statistics is collected from all occupational DB and hybrid schemes, via TPR’s DB and hybrid scheme returns. The report revealed right now used knowledge held by TPR as of 31 March 2023. Schemes are required to submit their returns by 31 March yearly.


Please enter your comment!
Please enter your name here

Read More