The Old British Steel Pension Scheme (OBSPS) has exited Pension Protection Fund (PPF) assessment and its members will not be entering the pensions lifeboat.

In a letter to members, the scheme trustees stated that they had made “good progress” towards a buyout.

Following its valuation, the scheme had enough money for Pension Insurance Corporation (PIC) to provide guaranteed future pension payments for all members at or above PPF levels of compensation.

The scheme secured a £2bn buy-in with PIC in October 2020 and now expects to complete a buyout with the insurer by late summer 2022.

The OBSPS had expected to complete the deal by the end of 2021, but trustees noted that the process was “taking longer than expected” due to recent legal rulings affecting pension schemes in general.

The trustees also informed members who are receiving PPF-level benefits that they would be receiving an increase in their current level of benefits.

As the scheme has now exited PPF assessment, members may be able to transfer to another pension arrangement if they have not started receiving their pension.

However, in a joint statement, the Financial Conduct Authority (FCA), The Pensions Regulator (TPR) and MoneyHelper warned that transferring out of a defined benefit pension scheme was “unlikely to be in the best interests of most consumers".

The statement read: “The FCA are working with the trustees of the scheme to monitor requests to transfer out and the firms who are advising members on their options.

“All advisers should be clear on the FCA’s expectations when offering advice to members of the scheme. Where the FCA sees unsuitable advice, or bad practice, it will take action.

“The FCA, TPR and MoneyHelper believe transferring out of a DB pension scheme is unlikely to be in the best interests of most consumers. Any scheme members looking for impartial guidance, or thinking of transferring out, should contact MoneyHelper on 0800 011 3797 before taking any further action.”

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