UK - Charity Help the Aged is closing its final salary scheme to new members.
Instead, the charity is setting up a more flexible money purchase plan in a bid to boost take-up.
The charity will close the defined benefit scheme from August 1 and offer new members a group personal pension with Standard Life.
Help the Aged said that many of its staff found its final salary scheme requirement of a 6% employee contribution too high and consequently had not joined.
Its contracted-in money purchase scheme will only require a 3% contribution from workers with the charity putting in a further 8%.
A Help the Aged spokeswoman said: “One-third of current employees elected to join the final salary scheme. Help the Aged believes that the new scheme is more appropriate to the needs of our employees.”She added: “The new scheme is more flexible and more affordable for employees.”
The decision to move from defined benefit provision was taken following a comprehensive review of the charity’s pension scheme in conjunction with Hymans Robertson’s scheme design practice.
Hymans Robertson partner and head of the scheme design practice Ali Khan said: “The Help the Aged scheme was trying to target the upper quartile in terms of what other charities were doing. The move was aimed at controlling future costs rather than trying to cut costs.”
Khan noted that in addition to an 8% employer contribution Help the Aged is also offering life assurance and ill-health insurance to members.
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