Pension fund protection has been a part of the government standards to protect retirees from their pension funds being liquidated by the corporation they were employed and retired. This came to the focus of the public media in 2004 when the government found that most of the pensions were underfunded do to the lack of pension fund protection and from corporations not matching the pension funds on a regular basis.
There were many individuals who were preparing to retire and who had already retired from their long-time place of employment only to find in actuality they had no pension left. The Board of Pension Protection Fund was established in 2004 and it offered new rules, insight, and mandatory matching of pension funds by corporations on a regular basis. They decided that for pension fund protection to function, as it was set up to function the best mandate was to have the pension funds matched every quarter to every individual who had a pension fund with their company.
The government made it understood that to have pension fund protection, the corporation was no longer permitted to utilize employee pension funds for other business purposes. They were at this time mandated to comply with all the new rules, laws, and regulation set forth in the new Pension Protection Fund Act of 2004. The pension fund protection was broken up in four very viable parts to assure all current and future retirees their pension funds were safe. The four parts are the eligible schemes, the scheme assessment, the compensation, and the levies.
The eligible schemes for pension fund protection are to contribute to the administration and compensation fund directly in behalf of the many employees who are only interested in pension fund protection. The next part of the equation is the scheme assessment, which refers to the quarterly and annual assessment of pension fund protection for all employees. At this point, of the pension fund protection everything is scrutinized to assure that all is going well and no employee needs to fear their pension will not be there when they are ready to retire.
The compensation part of the pension funding protection originates to all members who have extended the employment beyond their retirement years. This part also applies to those employees who retired earlier than expected because of a chronic illness or workplace accident. The law for the pension funding protection now states that all enrollees into a pension plan will receive benefits of one hundred percent. The levies or fines were instituted to assure all retirees their employer will match the necessary funds or be levied a hefty fine.