"In recent years companies across the UK have closed their final salary schemes to new members as the cost of funding them has rocketed on the back of increasing life expectancy and lower expected long-term investment growth. Many employers have also tried to further reduce their liabilities by tempting the existing members out of these final salary schemes and into alternative personal pension schemes. To get existing final salary members to transfer out of the scheme, companies have offered them enhanced transfer value packages. Although these packages may look attractive upfront, they do not always properly compensate members for the pension benefits they are giving up. One particularly controversial aspect of these incentive packages has been the cash payments made to those willing to transfer. However a government-backed voluntary code of practice, launched in June, now prohibits the payment of such cash incentives."

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