Part four of a Pensions Insight investigation speaks to charity pension provider the Pensions Trust about claims of mismanagement and unfairness


During the course of this investigation, one name kept coming up: The Pensions Trust.

The Trust provides pensions for 2,500 not-for-profit groups and over 200,000 members. Charities reserved their main criticism for the Trust’s Growth Plan, a scheme with multiple series (1 to 4), the first set up in 1946. 

Charities are angry that they are contributing to DB pensions which they previously believed were DC. Secondly, many feel the Trust has not communicated properly. Lastly it is considered too hard for employers to leave the Trust.

It is certainly a complicated scheme, as chair of trustees Sarah Smart (pictured) concedes. Central to the problem is the changing definition of the different types of scheme.

Smart explains that the Pensions Act 1995 turned series 1 and 2 of the Growth Plan from defined contribution to defined benefit schemes. The Trust had been warning employers since 2005 that the scheme was considered DB and “there was the potential for the trustees to request deficit contributions in the future”. It was not until 2013 that the scheme began collecting deficit payments.

We had been warning employers about this possibility for some time

Employers in series 3 have not yet been asked to make deficit contributions but have suffered from the same sort of regulatory creep as those in series 1 and 2. 

After the Bridge Trustees ruling in 2011, the DWP “effectively told” the Trust series 3 was now DB.

“We had been warning employers about this possibility for some time…  we cannot, unfortunately, compel employers to read our communications”, says Smart.

Employers have also said the Trust does not listen to them. More alarming is the claim that Growth Plan sponsors were invited to a series of meetings but their advisers were banned.

Some charities felt this left them ill-equipped to participate. Smart says this was to ensure space for as many charities as possible.

It’s very difficult for employers to understand what’s going on

The final complaint is the perceived difficulty of exiting the Trust. Smart is unequivocal. It is beyond the control of trustees to decide when s75 debt is triggered she says, adding that all the multi-employer schemes have DC sections, “meaning that employers do not have to trigger the debt when they stop accruing DB liabilities”.

Smart says a lot of the concerns of sponsors are valid but often regulation gets in the way. “One thing I’ve learnt in my four years here is that it’s not an easy scheme. It’s very difficult for employers to understand what’s going on.”

Read the rest of this investigation into the pensions problems faced by charities here.