Shell ends final salary pension scheme

Shell, the Dutch oil and gas company which is listed in London, is to close its final salary pension scheme, the last FTSE 100 company to do so.

The news means new hires from 2013 will no longer be able to count on the exact amount they will receive from the pension pot when they retire.

The replacement will be a defined contributions scheme which offers little or no guarantee over its final value.

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Shell currently employs just over 6000 staff in the UK.

The firm's pension pot, unlike many of its FTSE 350 peers, is not under-funded. Shell actually sought permission from the pension regulator in 2007 to stop making payments into the scheme as its surplus was so significant.

Nevertheless, by reducing its risk in the pensions arena, Shell will be freeing up cash for use in its exploration and production operations.

BS