# Underfunded DB Pension Scheme wound up



## Gemmell (16 Jan 2013)

The DB scheme I have been contributing to for over 30 years has been wound up and is underfunded by a massive amount. The trustees have advised all the members of their reduced pot and the shortfall on my expectations is circa 32%. What are my best options for my now reduced pot (I am 57 years old) and have I any redress options regarding the underfunding and lack of clarity regarding how it came to this? Can the trustees be served with a "Breach of trust" claim?


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## Macbeth (16 Jan 2013)

I'm sorry to hear about your situation. This happened to me a while back and after almost 40 years of service to my former employer, I will now receive only about 50% of my expected benefits. If you feel that the trustees of your pension fund behaved inappropriately, you could refer the matter to either the Pension Board or the Pension Ombudsman, though in my experience both of these bodies are useless and will do nothing for you. They will just fob you off and keep referring you to each other. If you want to pursue the matter, they may advise you to seek a legal remedy but this will probably involve starting proceeding against the trustees in the High Court - a very expensive process and with no guarantee of success. I've read in the media that former employees of De Beers Industrial Diamonds (Element Six) in Shannon are currently involved in such a case in the High Court (Commercial) where they are suing the trustees of their pension fund. It might be interesting to see how this case turns out. http://www.independent.ie/business/...me-members-say-they-are-owed-50m-3186092.html


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## LDFerguson (17 Jan 2013)

Sorry to hear about this Gemmell.  One of the reasons why your benefits are being reduced is the current law around winding-up of DB schemes, where existing pensioners have priority over active members like yourself.  [broken link removed], but nothing has been formalised as yet.


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## Gemmell (18 Jan 2013)

*Thank you for your replies*

Thank you Macbeth and LDFerguson.

Another matter in relation to this is that the employer has not paid in my contributions for a number of months either. The trustees assure me the employer has assured them the outstanding monies will be paid? Surely the fact they deducted the contributions from my salary and withheld it from the pension is to say the least a wee bit illegal? In relation to existing pensioners having priority, in this case that is not an issue as annuities were purchased for all retirees at the time. So the pot so to speak is to be divided amoungst those of us still in the scheme. But trying to get the exact details of how they calculate the amount each of us in entitiled to is like getting blood from a stone. All I seem to get is words and language that only actuaries can speak and understand. Percentages and actual calculations seem to be a no no? Fraustrated is one word to describe how I feel. Thanks again both of you.


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## LDFerguson (18 Jan 2013)

Gemmell said:


> Another matter in relation to this is that the employer has not paid in my contributions for a number of months either. The trustees assure me the employer has assured them the outstanding monies will be paid? Surely the fact they deducted the contributions from my salary and withheld it from the pension is to say the least a wee bit illegal?


 
It certainly is.  Employers have a legal obligation to pass over contributions no later than 21 days after they were collected.  Your first port of call there should be the Pensions Board, who take an interest in breaches of this rule.  While taking to them, bring up your other concerns and they may be able to help.


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## Gemmell (27 Jan 2013)

Thank you, the pensions board is the way I'll go now. Cheers


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