UK - The move to close defined benefit provision is gaining momentum, according to Towers Perrin.
The investment and actuarial firm found that two thirds of employers installing new defined contribution plans cite controlling costs as a major factor.
Partner Mark Duke said: “The bandwagon is rolling. Employers say they are responding to a very strong market trend.”
But the survey of 180 companies found that administrative failure posed a high risk to DC schemes.
The survey also found 85% of trustees felt they needed to enhance their knowledge of investment issues.
Duke added: “Running a DC plan is challenging. We have evidence that there is lots of work still to be done. Plan members need more guidance. Many employers and trustees need a better understanding of the issues.”
By Alistair Graham
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