How safe are workplace pensions now?
If you have a money purchase scheme where you have your own pension pot and where the employer guarantees nothing then you are dependent on the regulator, The Financial Services Authority, which now seems to have sharper teeth and be hungrier to seek out bad practice. With a money purchase plan (and indeed, any other form of personal pension) your main worry is the insurance company that runs it going bust. So far, this has never happened. But if you have a final salary plan, then it could all go wrong if the firm providing it goes bust as several have. After lots of scandals where employees lost huge sums, there is now a safety net the Pensions Protection Fund. This is better than nothing but not a full replacement for a lost fund. On 6 April 2005 the Pensions Regulator took over from Opra (the Occupational Pensions Regulatory Authority). The Pensions Regulator is the new regulatory body for work-based pension schemes in the UK.
