An £8m settlement has been announced following an investigation into the MG Rover Group senior pension scheme by The Pensions Regulator.
The scheme is now expected to avoid entry into the Pension Protection Fund (PPF) and provide its members with benefits in excess of PPF levels as a result of the settlement agreement.
In December 2012, the regulator issued a warning notice to MGR Capital Limited (Capital), indicating its intention to issue a financial support direction (FSD).
Following representations from Capital in response to the warning notice, an agreement was reached this week (October 20) between the trustee of the scheme and Capital, in which Capital agreed to pay £8.085m into the scheme.
This sum is expected to allow the scheme to wind up outside the PPF and to enable its members to receive benefits above PPF levels. In light of this agreement, the regulator is no longer seeking to issue an FSD against Capital. Details of the case and the settlement are published today in a section 89 report by the regulator, which can be viewed here.
View the MG Rover Group section 89 report in section 89 reports.
The regulator’s interim chief executive Stephen Soper said:
“I am very pleased with the £8m settlement which is substantial in this context and an excellent outcome for the scheme.
“Our involvement once again demonstrates that the regulator will not hesitate to use its powers to protect the retirement savings of scheme members and limit calls on the PPF.
“It is clear that our warning notice led to productive negotiations with Capital, concluding in a settlement which achieves our joint objectives to act in the best interests of scheme members and the PPF.”
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