Company pension payments

gospete

This is probably a very basic question, but I'm a bit confused.

I have recently started to receive a deferred final salary pension. Although a third party company administers the scheme (on behalf of the trustees), the actual monthly payments I receive come via my ex employers payroll.

Do companies usually deal with the process of actually paying a pension to their (ex) employees? I thought the 'pension pot' and thus payments were usually under the umbrella of a regulated Insurance company.

Am I getting confused with a Company vs a Private pension? In which case is the latter more secure?

If someone can explain or point me in the right direction I would be most grateful.

RichandJ

gospete wrote: »

This is probably a very basic question, but I'm a bit confused.

I have recently started to receive a deferred final salary pension. Although a third party company administers the scheme (on behalf of the trustees), the actual monthly payments I receive come via my ex employers payroll.

Do companies usually deal with the process of actually paying a pension to their (ex) employees? I thought the 'pension pot' and thus payments were usually under the umbrella of a regulated Insurance company.

Am I getting confused with a Company vs a Private pension? In which case is the latter more secure?

If someone can explain or point me in the right direction I would be most grateful.

It varies, some do, some have it paid via the third party administrator or even a completely separate payroll agency.

Probably. It sounds like an occupational scheme, what you are calling a company scheme. In which case the payments are backed by a) a fund separate from the company's assets and b) if there turns out not to be enough money to pay the benefits, the Pension Protection Fund.

nearlyrich

My DH gets a final salary pension paid by the company he used to work for on the same day as the payroll is run. It is a big company and as it goes they are in the insurance game.

Linton

gospete wrote: »

This is probably a very basic question, but I'm a bit confused.

I have recently started to receive a deferred final salary pension. Although a third party company administers the scheme (on behalf of the trustees), the actual monthly payments I receive come via my ex employers payroll.

Do companies usually deal with the process of actually paying a pension to their (ex) employees? I thought the 'pension pot' and thus payments were usually under the umbrella of a regulated Insurance company.

Am I getting confused with a Company vs a Private pension? In which case is the latter more secure?

If someone can explain or point me in the right direction I would be most grateful.

The scheme trustees are responsible for paying Final Salary (aka Defined Benefit) pensions and presumably it is most efficient for them to use the employers payroll system. There is no "pot" and may be no insurance company directly involved.

With a Defined Contribution scheme then there is a "pot" which may be paid to an insurance company to buy an annuity. The insurance company is responsible for administering the payment of that annuity.

gospete

Thanks for the responses.

Am I right in thinking that all pension schemes are regulated to a degree?