Pension plan setup is an obligation of which party?

Pension plan setup is an obligation of which party?

• A. Employer
• B. Employee
• C. Government
• D. Trustee

Answer: (A)

The obligation to set up a pension plan lies with the employer, who acts as the plan sponsor. The employer designs the scheme, provides funding, and establishes the governance structure, including appointing the trustees who operate the plan within the trust. Employees participate and contribute under the plan’s rules, but they do not initiate the plan. The government sets the legal framework, and the trustees manage the plan day-to-day within that framework.

The obligation to set up a pension plan lies with the employer, who acts as the plan sponsor. The employer designs the scheme, provides funding, and establishes the governance structure, including appointing the trustees who operate the plan within the trust. Employees participate and contribute under the plan’s rules, but they do not initiate the plan. The government sets the legal framework, and the trustees manage the plan day-to-day within that framework.