by Louise Greenwood BBC Radio 4

There are growing calls for protection for workers who pay into a company pension, as more schemes wind up or companies go bust.

Nearly 300 final salary pension schemes have been wound up over the last year affecting at least 40,000 people.

Many workers think that if their employer is made bankrupt, or decides to close its pension scheme, the contributions they have made are safe. But that is not the case.

Moneybox spoke to Maurice Jones, who had paid into the pension fund at his textile firm in Bolton for 38 years, expecting a retirement income of two thirds of his final salary.

When the firm was put into administration by its parent company five years ago, leaving a shortfall in its pension fund, Maurice learnt to his horror that he would get nothing back.

He said he has been left feeling terribly shocked and ashamed.

"How do you speak to your family about it? How do friends behave towards you knowing you can no longer afford to have the lifestyle you have led with them in them previous times?"

Current law

In fact the current law gives priority to people already drawing a pension when the fund goes bust.

If there is a shortfall after these pensions have been paid, the remaining employees will see a cut in their retirement income, or like Maurice, may even get nothing at all.

Doctor Ros Altman, a pensions expert who advises the government, believes this lack of protection is scandalous.

She would like to see the law changed and the introduction of an insurance scheme to protect workers paid for in part by a premium charged to the companies who subscribe.

"The cost of providing insurance should not be that high... Some estimates put it at 0.1% of a company's assets. In order to provide protection for so many members it does not seem an inordinate amount to pay."

US Scheme

Indeed such a scheme has existed in the US for almost 30 years.

The Pension Benefit Guaranty Corporation, based in Washington DC, stepped in recently when Polaroid, American Airlines and the steelmaker LTV all filed for bankruptcy with shortfalls in their pension fund.

But there are concerns about the practicalities of introducing such a scheme in the UK.

Malcolm McLean, Chief Executive of the Pensions Advisory Service, says it could actually lead to more companies scrapping their final salary pension.

He said "The big, totally solvent employers would take the view that they are paying for nothing and if costs start escalating out of control they will seriously consider closing these schemes down."

Green paper

The government has told Money Box it is reconsidering the idea of pensions insurance.

A green paper spelling out the government's response to the current crisis in pensions is expected next month.

But it will come to late for Maurice who says of the years ahead:

"It is going to be a disaster. I am virtually 64 years of age... I now find I have no money and that is when I expected to find I had sufficient funds to see me through a nice retirement, I worked for that. "