You may have heard that the Scheme has a large deficit that could damage plumbing firms. You may be worried about this and wonder whether your benefits are safe.
The Scheme is currently paying, and intends to continue paying all members benefits in full.
The Scheme is run by a Board of Trustee Directors. The Trustee Directors have a duty to monitor the Scheme’s financial health to check that the Scheme holds enough money to pay all members benefits in full. The Scheme Actuary is currently carrying out the formal actuarial valuation as at 5th April 2017.
If the Scheme were discontinued and the Trustee decided to wind it up and buy annuity policies for all members from an insurance company, there would be a large deficit because this would be a very expensive step to take. However, the Trustee does not intend and is not required to do this. You can find further information in the Summary Funding Statement from the Scheme Actuary on page 5 of the Annual Update 2016.
The deficit in the hypothetical situation that the Scheme discontinued is important for a complex piece of pensions legislation, called Section 75 employer debt, because it affects the payment an employer in a multi-employer pension scheme must make when it leaves the Scheme. It does not affect member benefits.
