The oil firm made the decision to withdraw its defined benefit (DB) offering next year in order to reflect the current trends in the UK. However, the announcement will do little to quell nervousness around the future of such pensions.
A survey by MetLife Assurance highlighted than more than 50 per cent of DB members were concerned that the scheme would no longer exist when they came to retire.
“Our research on the views of employees and employers shows both need a better understanding of what constitutes adequate pension provision and how to achieve, maintain and protect it,” commented Emma Watkins, Director of Business Development at Metlife.
Communication is key to ensuring that employees understand what benefits their pension provides and to dispel any concerns. This is particularly true if a scheme is to move from a DB to defined contribution system.