UK – The £11bn (€17bn) Lattice Group pension scheme, the pension fund of the gas and telecoms infrastructure company, has announced it has closed its defined benefit scheme to new members.
In its latest annual report, the company says it has launched a defined contribution scheme for new employees. It claims this is a “more cost-effective and flexible pension scheme.”
A spokesman for the fund refused to confirm the introduction of FRS17 as the main culprit behind the move but suggested the downturn in the equity markets was a factor.
“We undertook a review of the structure of our pension arrangements in response to the rising cost of our DB plan and the fact that equity returns are down at the moment.
“Our decision was also influenced by changes in the state retirement provision. We are aware that other companies have blamed FRS17 for their DB closures but we cannot say how much difference this will make at this point,” he says.
The Lattice Group pension scheme has over 16,000 active members, more than 77,500 pensioners and just under 36,500 deferred members.