Is the CARE pension scheme offered by Network Rail permissible?
July 10, 2016
Q: I understand you have answered questions regarding CARE pension schemes and regard it as permissible. However the option (from Network rail) I have been given states that I contribute 7% of my pensionable salary to earn a unit of pension which is 1/60 of the salary. The company states that employee contributions cover 40% of the cost of benefits and the employer covers the remaining 60%. They also state that contributions are invested in investment funds and they are the responsibility of the trustee who decides where they are invested and monitors the performance. Would this pension still be permissible?
الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب
A: Yes, it is permissible. The investments made by the pension fund are not made on your behalf. As a pension holder, you are simply assured a certain level of benefit at retirement.