Speaking in an interview with the Daily Telegraph, PPF chief executive Alan Rubenstein explained: It is misleading to allow people to expect promised pensions when in fact there is only money enough to pay about 60% of those pensions and where nothing is being done about the shortfall.

The majority of people affected by the warning are workers in thei r 40s and 50s.

Mr Rubenstein added: There is clearly a proportion of schemes which will never, ever meet their full benefit promises.

The PPF pays retirement incomes to people who lose their pensions as a result of their company going under.

Under the scheme, savers who have not yet retired will receive up to 90% of the expected retirement income, up to an annual cap of around £30,000.

Most workers are not affected by the cap, but some high earners can lose significant retirement income if their employer goes bust.

Around 11 million people have pension savings in the 6,000 defined benefit (DB) schemes in the UK, such as final salary pensions.

They are often described as gold plated because they are designed to give savers a guaranteed level of pension income linked to their final or average wages.

Mr Rubenstein later issued a statement to clarify the PPF’s position and caution DB savers to be wary about using new powers available from April to transfer their funds into other types of pensions.

When I spoke with the Telegraph, I made clear that one month’s deficit numbers are not a cause for panic, he said.

However more than five in six schemes are currently in deficit and some of those schemes will not be able to meet the promises they’ve made.

What is important is that pension promises will need to be funded over time. The Pensions Regulator is responsible for overseeing the funding regime to make that happen.

While it’s clear deficits are at record levels at present it’s worth remembering these numbers are volatile — a year ago the deficit on the 7800 index (a measure of the aggregate deficit of DB schemes) was only around a quarter of the latest level.

At the same time it is important that scheme members are not misled into thinking a DB pension promise is the same as a DC (defined contribution) pot but that secondly, because of the protection offered by the PPF, members should still think very carefully before giving up their DB benefits and transferring to a DC arrangement to take advantage of the new freedoms available from April.

February 23, 2015 14:02

I suppose the answer to the poll depends upon a) whether or not you are part of a defined benefit scheme, and b) what state that scheme is in.

In my case, I'm in such a scheme, and it is well funded, with an agreed plan in place to make it full-funded over the next seven years — on that basis I answered 'yes'.

However I can certainly understand that there will be a majority of people who are in defined contribution schemes, which are far less certain and who would have voted 'no'.

We used to have a far more stable company pension situation in this country — but unfortunately too many large companies were allowed to stop contributing to their schemes when profits and growth were good — then complained when the next downturn came and they had a shortfall to make up, subsequently closing their schemes due to their own underfunding.

I'd urge everyone who is part of a DB scheme to check the regular statements that come from their pension provider, and to raise questions directly with the provider or trustees as they arise, especially where there appears to be a significant shortfall in funding.