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The Pensions Regulator is unlikely to achieve its policy aims in new proposals to revise clearance procedures for defined benefit pension schemes, according to The Society of Turnaround Professionals.

Clearance is a method of seeking confirmation that the Regulator will not penalise parties connected with an employer’s defined benefit scheme. This facility has enabled company turnaround activity to carry on over the last two years. Now, the turnaround professionals say that the Regulator’s proposals will undermine the current certainty and clarity, due to the confusion the new guidance will create at point of delivery. With the increasing number of financing problems due to the credit crunch, cumbersome and confusing guidance will reduce the chances of company survival.

Responding to a low-key consultation, The Society of Turnaround Professionals set out its main concerns as being:

• A disincentive to investors to provide finance to sustain troubled companies, especially introducing new money

• Delays and obfuscation that could well see many more companies failing

• An onus on trustees to be constantly negotiating, even where they have no legal right to do so

• Confusion about the pension deficit quantum that complicates deal pricing

• Potentially damaging existing shareholders’ interests

• Unsecured creditors gaining inequitable advantages

• Inadvertently excluding trustees and employers from the clearance process due to the necessity of relying on external professional advice

• Making clearance unaffordable in some situations

The Society of Turnaround Professionals says its response is informed by a long history of practical experience in turning around organisations in serious difficulties. Its members want to help perpetuate an environment in which equitable and pragmatic results can be achieved in the minimum reasonable time.

Further information: Christine Elliott, Chief Executive, STP +44 20 566 4222 +44 7812 370121

Editor’s Note:

‘STP’ members are among Europe’s top turnaround executives, whose role is to restore value to distressed companies. They have been active in some of the UK’s and international most high-profile organisations.


This press release was distributed by ResponseSource Press Release Wire on behalf of Institute for Turnaround in the following categories: Business & Finance, for more information visit