The John Townsend Trust Pension and Assurance Scheme has agreed a £30m full scheme buy-in deal with Legal & General (L&G) Assurance Society.

The transaction will cover over 280 pension scheme members of the charity’s scheme.

The scheme entered Pension Protection Fund (PPF) assessment in December 2015 following the insolvency of its sponsoring employer, John Townsend Trust.

Agreed on a PPF+ basis, the buy-in allows trustees to secure benefits for the scheme’s members at or above the level of compensation that would have been provided by the PPF.

L&G has previously agreed PPF+ buyout deals with the Mowlem (1993) Pension Scheme and the Nortel Networks UK Pension Plan.

Independent company, Open Trustees, was advised on the transaction by Barnett Waddingham LLP and legal advice was provided to Open Trustees by Gowling LLP.

Commenting on the deal, Open Trustees managing director, Jonathan Hazlett, said: “We are delighted to have entered into this PPF+ buy-in policy with L&G.

“The insurance market is extremely busy at the current time and it can be very challenging to secure member benefits for smaller schemes. Notwithstanding this, L&G have offered us the opportunity to ensure that scheme members receive benefits greater than what they would have received from the PPF.

“It has been a long process getting to this point as we negotiated all of the difficulties associated with the charity's insolvency and, in particular, realising our interest in the school buildings.

“Whilst the PPF provides a valuable safety net and a significant level of protection, many members will now receive higher benefits than they might otherwise have expected had the scheme entered the PPF.”

L&G Retirement Institutional director, Adrian Somerfield, added: “Being able to help pension schemes whose sponsors have become insolvent is extremely rewarding and we are delighted to have helped the trustees secure a transaction which provides long-term security to the scheme’s members.

“This transaction is a great demonstration of how we can assist pension schemes exit PPF assessment and move to buyout with an insurance company.”

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