Pension Protection Fund kicks off today to support employees of defaulting companies
A glimmer of hope was offered today to beleaguered Courts and Allders pensioners as the Pension Protection Fund came into effect.

Furniture group Courts collapsed at the end of last year, followed soon afterwards by department store group Allders. Thousands of former employees feared they faced an old age in poverty, but the fact that the pensions funds have not yet been wound up means they may be eligible for help if needed from the newly established pensions lifeboat.

The future of the Courts scheme is being reviewed by HR Trustees, the independent trustee appointed by administrator KPMG, and findings are expected soon.

Allders' administrator, Kroll, has guaranteed to keep the pension scheme stocked up with contributions until June.

The Courts scheme's deficit is understood to be£14 million and Allders'£7.4 million, but the liabilities would be much greater if the schemes were wound up.

Although pensioners hope they will benefit if necessary from the Pension Protection Fund, there are likely to be hurdles still to cross. There are fears that the scale of demand on the new scheme could create unforeseen pressure, heightened by uncertainty over the future of MG Rover, which could overwhelm the fund because of its size.