UK - Members of the KPMG Staff Pension Scheme want the pensions ombudsman to resolve whether they are in a final salary or money purchase scheme.
Members – who are furious at potential cuts of up to 20% in the KPMG Pre-April 2000 Fund – have shown PP several letters which explain that contributions paid into this scheme “purchased” only a notional amount of pension.
One scheme member said: “I asked questions repeatedly as to whether this pension was safe and was always told it was. There was never any warning to say the pension was not guaranteed and that you might not get the figure quoted in the annual statement.”
A letter sent to members of the Pre-April 2000 Fund in June says they must bear the brunt of any falls in the fund’s value.
It also states that it is a defined contribution scheme – not a defined benefit scheme as many members had been led to believe.
This followed an earlier letter to members telling them the fund’s assets were no longer sufficient to support the pre-2000 scheme conversion rates.
A KPMG spokesman said: “This was set up as a defined contribution scheme and all the actuarial and legal advice we have had since backs this view. The way the trustee himself is operating this scheme would also support the fact that this is a defined contribution scheme.”
He added: “We are now working to bring forward the new stakeholder scheme with wider investment choice at low cost.”
By Jonathan Stapleton and David Rowley
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