Solvency II has pushed interest in the 'non-buyout' pension solution for defined benefit (DB) schemes because of growing industry concern surrounding the European directive, reports Occupational Pensions Trusts (OPT).

The organisation, formed to offer an alternative to the buyout market for occupational pension schemes, said enquiries from pension trustees for the year so far are more than double last year's figures, with September showing particularly high results.

"Employers are continuing to seek cost-effective ways to remove pension scheme liabilities from their balance sheets, but we believe that it has become increasingly difficult to get buyout quotes from insurance companies who are starting to factor in the dramatic impact Solvency II could soon have," explained Ben Shaw, development director at OPT.

"A buyout may be the best solution but one only a minority have been able to afford. The prospect of buyouts becoming even more expensive is naturally raising interest in the range of other cost-effective de-risking solutions that do remain within reach."

Shaw added: "If costs can be minimised through economies of scale and suitable, diversified investment strategies followed, even underfunded schemes have a chance of recovering and going on to pay full benefits.

"We are in an environment where pension scheme trustees need to be considering all the options available. They are realising that simply keeping the scheme running for growth - doing what pension schemes were designed to do in the first place - should not be overlooked."

OPT's offering, which allows schemes to separate from the sponsoring employer and club together in a 'national confederation', could, Shaw said, work out at up to 90 per cent cheaper than a full buyout.

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