The unfortunate story of Carillion, which is seemingly becoming more frequent, is akin to what happened with BHS but on a much bigger scale.
BHS's liabilities when it went into administration were in the region of £500m.
Comparably, Carillion operated 13 final salary pension schemes in the UK which accumulated liabilities of around £3.5bn, with assets of around £2.5bn.
All members from the 13 defined benefit schemes will now get Pension Protection Fund (PPF) compensation and therefore it will be down to the PPF to plug the £1bn shortfall across the schemes.
What does this mean for members?
For those above normal retirement age, they will continue to receive their pension in full, but for those yet to retire or those who have retired in good health but are below normal retirement age will receive lower pension benefits than anticipated, with a minimum 10 per cent drop immediately.
Most members will also have lower increases in the future.
There is some good news in this terrible tale, in that the PPF currently has a surplus of around £6bn so it can easily take on Carillion's pension liabilities at the current time.
However, the subsequent impact could be an increase in PPF levies for other defined benefit schemes in the medium to longer term.
I am surprised more wasn't done by the government to stop the collapse of Carillion, particularly given their significant involvement with Tata Steel, although that may have been a political move to ensure that steel production remained in the UK.
Stuart Price is partner and actuary at Quantum Advisory