The Old British Steel Pension Scheme (OBSPS) is in advanced negotiations for a buyout funded by Pension Insurance Corporation (PIC), according to a report from Sky News.

The rumoured negotiations are underway more than two years after the scheme, which has over 30,000 members, entered an assessment period overseen by the Pension Protection Fund (PPF) on 29 March 2018.

The report follows a letter sent to scheme members in April, which said the scheme’s funding had been “in a better position than expected” when it entered PPF assessment, adding that this meant the scheme “might be able to move to an insurance company instead of moving into the PPF”.

The letter continued: “In many ways, moving to an insurance company is the same as moving to the PPF. They would pay you your benefits directly and the scheme would cease to exist.

“The main difference is that the insurance company might be able to pay you higher benefits than the PPF would.”

The letter estimated that any buyout would be secured by 2021, while Sky News’ sources cautioned that any deal involving the scheme, which had assets worth around £1.9bn at 31 March, would still be months away.

OBSPS trustee, Open Trustees Limited, also cautioned that it was still not certain that any buyout would happen.

The report added that an insurance deal for the much larger British Steel Pension Scheme, which has assets worth over £10bn and around 120,000 members, is currently the subject of separate discussions.

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