The number of U.K. defined benefit schemes that closed to new members almost doubled in the last year, according to a survey released today by the National Association of Pension Funds. Eighty-four schemes were closed in 2002, compared with 46 the previous year and 18 in 2000, although the 2000 figures did not include public schemes.
Respondents cited cost, regulatory burden and new accounting standard FRS 17 as the biggest reasons for closing; 61% thought it took "a lot more" company resources to provide pensions today than five years ago, and just less than half thought it would require even more resources in the next five years.
"There is a real danger that as the cost of provision rises, the level of (pension) provision will fall. Lower investment returns and longer life expectancy have contributed to this cost pressure," said Christine Farnish, NAPF chief executive.