UK says new rules to save schemes £10m

UK - The Department for Work and Pensions says new "bulk transfer" rules will save smaller schemes around £10m (€14.7m) a year.

"New regulations published today will make it easier for employers who are running several smaller schemes to bulk transfer members with protected rights into one single pension scheme," the DWP said.

It added: "It is expected that the new regulations will save pension schemes £10m over the next three years and they will come into force from November 28 2005."

The changes will mean that subject to approval from actuaries that a member's rights will be broadly no be less favourable, protected rights can be transferred in the same way as other pension rights are currently. This will help reduce administrative cost and burden on employers.

"Through mergers and acquisitions companies can be in a position where they are administering a number of smaller pension schemes and they may wish to run them as one scheme," said DWP minister Stephen Timms.

"Where it makes sense for these employers to consolidate their pension schemes into one it will now be less expensive and time-consuming to do so. These changes are about making it easier for employers to run these schemes which will benefit their members.

Meanwhile, pensions have played a role in Ericsson’s takeover of the Marconi brand and telecoms assets today.

A special escrow account has been set up at the behest of the Pensions Regulator.

The rump of Marconi, now renamed Telent will retain responsibility for the UK pension plan. There will be £185m injected into the fund and £490m retained in an “escrow arrangement” for the potential benefit of the fund.