Royal Dutch Shell signalled the end of an era for the UK pensions industry by announcing plans to close its final-salary pension scheme to new members, making it the last FTSE 100 company to do so.

The Anglo-Dutch oil group said it planned to close the pension scheme next year in order to “reflect market trends in the UK”.

Existing members of the fund will be unaffected – as will all new employees at the group who join before the scheme is closed.

Shell is the only constituent of the FTSE 100 that currently operates a final-salary scheme open to new members. The fund makes pension payments to about 30,000 pensioners and has about 6,500 active employees as members.

According to its last official valuation in December 2010, the scheme had a surplus of £1.1bn. Experts say it continues to be one of the best funded schemes in the UK.

In a statement, Shell said: “The company announced that it is proposing to develop a UK defined contribution pension plan for new hires to Shell to reflect market trends in the UK. The plan will be designed to ensure that the reward package in the UK for new hires remains strongly competitive.

“Active members of the fund will continue to accrue pension benefits within those plans on the same basis as now. The company has confirmed that its commitment to funding the Shell Contributory Pension Fund and the Shell Overseas Contributory Pension Fund remains unchanged.”

Further details on the plans will be released over the next few months.

However, the move is highly significant with figures from the National Association of Pension Funds estimating that only 19pc of private sector schemes are now open to new members, compared to 88pc a decade ago. Many large companies such as Aviva have already closed their final-salary schemes to existing members.

John Ralfe, an independent pensions consultant, said: “The closure of Shell’s scheme to new members, 10 years after many other large UK companies did the same, marks the end of the beginning of this process. Many large companies are now taking the next inevitable, but more difficult step in the process and closing to existing members”.

Figures from BNY Mellon show that the average UK pension fund booked a negative annual return last year for the first time since 2008 last year, due to market volatility caused by the eurozone debt crisis.

Returns were minus 0.9pc for the year, BNY Mellon estimated, due to a negative return of 4.8pc during the third quarter. All other quarters of the year saw slightly positive returns.

Alan Wilcock, performance and risk analytics manager at the group, said: “2011 was a very volatile year for assets of pension funds. Although returns were only slightly negative for the year as a whole, higher inflation and lower long-term interest rates will have added to pension scheme liabilities.”

Pension schemes are also facing a fresh assault from Europe with PriceWaterhouseCoopers warning that new capital rules could leave British businesses with new costs of between £250bn and £500bn for their pension schemes.

Last month, Steve Webb, the pensions minister, put the potential cost of proposed Solvency II rules at £100bn for British firms.

Source : The Telegraph