Trade Union Congress (TUC) has called for a full review of of pensions buyout models in order to anticipate any future threats to members’ interests.
During a pensions buyout a finance company takes over a pension scheme from a sponsoring employer.
TUC welcomes additional powers proposed for The Pensions Regulator, which it believes will help protect pension schemes from poorly-funded buyouts or unscrupulous investors that put pensions at risk. However, TUC is calling for a full review of the buyout process to ensure that the regulatory regime is fully up to date.
Brendon Barber, TUC General Secretary, said: “The buyout market has grown at breakneck speed in the last 12 months. While insurance-based buyouts can provide greater security to members’ schemes, the growth of increasingly complex and potentially risky new buy-out models could pose a threat to pension schemes. Without better regulation, it would only be a matter of time before we faced a similar disaster.”