On the go: The John Townsend Trust Pension and Assurance Scheme has agreed a £30m full scheme buy-in with Legal & General, moving out of the assessment period at the Pension Protection Fund.
The transaction covers the benefits of more than 280 pension scheme members and is a first step towards a buyout, which is expected by the end of 2022.
The scheme entered PPF assessment in December 2015, following the insolvency of its sponsor John Townsend Trust, which operated the Royal School for Deaf Children in Margate, a charity that provided education and care to deaf children and young people.
According to a statement, a “significant amount of work” has been undertaken by FRP Advisory, the charity’s liquidator, and Open Trustees, the scheme trustee, to achieve the best return possible, which includes the pension fund receiving the proceeds from the sale of the school buildings to Kent County Council.
While all members will continue to receive their current PPF levels of compensation, the exact outcome for each member will not be known until the buyout occurs, Open Trustees stated.
Jonathan Hazlett, managing director of Open Trustees, 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.”
Hazlett said that it had been “a long process getting to this point as we negotiated all of the difficulties associated with the charity’s insolvency”.
He continued: “While 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.”
The fund’s investment consultant, Barnett Waddingham, advised on the transaction, while Gowling provided legal advice to Open Trustees.
This article originally appeared on MandateWire.com
