Warning over pension scheme funds

31/10/2008 08:22:03

Pension scheme trustees are being warned they should not demand extra cash from companies to plug holes in pension funds.They are being told that the extra pressure could put too much strain on firms on the brink of a recession.Aon Consulting says trustees may now ask for tens of billions of pounds a year extra to make up fund deficits.This is despite pension funds losing hundreds of billions of pounds because of the economic downturn.The UK's final salary schemes lost a quarter of a trillion pounds over the last year following weaker investments.Aon Consulting argues that trustees should take a longer term view.It says companies are facing the toughest environment ever for final salary pensions, with falling stock markets hitting the pension funds, and the economic downturn making it more difficult for companies to contribute extra cash.It argues trustees and businesses should work out a long term plan which may even mean companies reducing their pension contributions in the short term.