Early in the pandemic, the Pensions Regulator said trustees could allow cash-strapped employers to pause the deficit contributions they had signed up to, though with strict conditions to stop resources draining out of vulnerable companies.
Willis Towers Watson said while TPR claimed only 3 per cent or 4 per cent of schemes had used this facility by October 2020, there has been a drop in the aggregate value of FTSE350 deficit contributions, from £4.9bn to £4.5bn.
Collins added: “A much more common way for companies to preserve cash has been to reduce dividends. As corporate revenues recover, some companies may argue that keeping pension payments steady and allowing dividends to vary applies equally in good times as well as bad.”
simoney.kyriakou@ft.com
