The curtain will finally fall on the Scottish Voluntary Sector Pension Scheme (SVSPS) run by the Pensions Trust at the end of March 2010. This is a multi-employer pension scheme covering hundredss of small charities and not-for-profit organisations which will close for all future benefit accrual.

Now I’ve been banging on for a number of years about the headaches this scheme has been causing small charitable bodies (frequently without them even knowing about them!!). The provision of final salary benefits for many of these organisations was patently unaffordable and the promotion of them difficult to justify with a car crash pretty much inevitable. But the car crash has just become a train wreck and one that’ll take a long, long time to resolve.

Employers were gradually becoming more aware of the issues as contributions rose steadily year on year (18 per cent in 2002 to 29.75 per cent in 2008) to unsustainable levels for many organisations but the picture has become very stark indeed as very significant deficits have been identified which will take the organisations participating decades to pay off.

Participants will have been reviewing their benefit provision over the last few months and this time they really need to get it right and arrive at a solution that meets their needs. Boards of trustees must seek out independent advice to identify a course of action which provides an affordable, competitive and sustainable arrangement for their organisation and staff.