It has been predicted that claims on the new Pension Protection Fund could be three or four times more than expected.
That is according to a study from credit research agency Standard & Poor, which found that the claims could be several times more than the £300 million annual levy collected from employers.
S&P feels the deficit will be more than £670 million and believes it could even be as much as £1.12 billion.
However, it conceded that if economic conditions were at their best in the coming years the deficit could be around £320 million - but still a massive loss nonetheless.
This would depend on the fund recovering 40p from every £1 lost when a company goes bankrupt.
But this really would be the best-case scenario and therefore distinctly unlikely.
The study focused on the average experience of companies, looking in particular at the 342 largest private sector defined benefit schemes and the probable condition of the remaining 5,000 pension schemes that were eligible for protection from the fund.
Rise in claims expected for pensions
Pensions Quote Line
0845 108 0505
Rise in claims expected for pensions
Tue, 19 Apr 2005
| pensions news |
|---|
| Warning on pension annuities - Thu, 22 Jul 2010 |
| Government reforms pension annuities - Tue, 20 Jul 2010 |
| Pension holders set to benefit from energy rebate scheme - Tue, 13 Jul 2010 |
| More News |
Pensions Newsletter
Monthly pensions news, provider info & more.
Transferring a Pension
Learn more about pension transfers and enquire about transferring your pension.
SIPPs
Read up on Self Invested Personal Pensions and take control of your pension fund.