MACLAY Murray & Spens offloaded its final-salary pension scheme in the past financial year, potentially to get rid of the liability ahead of a possible merger deal.

Although the scheme was closed to future accruals in June 2006, the firm has remained responsible for funding its future liabilities and contributed £85,000 to it in the 2014/15 financial year.

In a note to the firm’s LLP accounts, which were filed at Companies House this week, MMS chief executive Kenneth Shand said the firm had bought

an insurance policy “that will provide all future pension benefits for the individual members of

the scheme”.

“During this financial year the benefits were confirmed as secured by the insurance policy, thereby removing the liability from the trustees,” he added.

While the deficit on the MMS pension scheme was not large, standing at £3,000 in 2014/15, such liabilities have led a number of law firms to abandon proposed merger deals in recent years

Once one of the Scottish

Big Four firms alongside Dundas & Wilson, McGrigors and Shepherd & Wedderburn, MMS has made no secret of its desire

to secure a merger deal after a series of failed talks.

In 2012 it failed to reach agreement over a deal with English firm Bond Pearce that would at the time have created a firm with turnover of around £95 million. Bond Pearce went on to merge with Newcastle firm Dickinson Dees. Last year MMS and Addleshaw Goddard called off merger talks, with the latter now set to take over Glasgow firm HBJ Gateley.

In recent years Dundas & Wilson and McGrigors have been taken over by CMS and Pinsent Masons respectively, while Shepherd and Wedderburn has bulked up by buying the business of Tods Murray out of administration.

In the meantime, MMS has been overtaken in size by Brodies and Burness Paull, which in the past financial year turned over £65.1m and £53.3m respectively.

The firm’s accounts also show that, in the year to May 2016, MMS turned over £44.7m, which represents a rise of three per cent on the previous year. The figure is some way behind the £60.8m the firm generated in 2007/08, its best-ever year.

Despite this, Mr Shand said in a note to the accounts that the recent increase in turnover is “an early indication” that the firm’s strategy of “investing for the future” was working.

During the course of the year the firm took on five partners and 30 staff from McClure Naismith, which went into administration in August 2015. This helped MMS’s staff headcount rise from 316 to 359 during the year while its partner headcount increased from 60 to 64.

“Having invested in people, creating further depth and breadth across the firm, we are confident that the overall financial performance will continue to be strengthened in the coming year,” Mr Shand said.

While the amount of profit the firm had available for partner distribution fell by 10 per cent to £13.2m, the increase in partner numbers meant the average payment each received fell by 15 per cent, from £243,000 to £206,000. The highest-earning partner received a profit share of £336,000. In the previous year the firm’s top earner received £346,000.