Qualified Financial Adviser (QFA) Pensions Exam 2 Practice Test

Long-term borrowing by a pension scheme is tightly regulated, with a notable exception for Small Self-Administered Pension Schemes (SSAS/SSAPS). These schemes are designed to give trustees the flexibility to borrow to invest in assets for the benefit of the members, typically by taking a secured loan to acquire investments such as property. The key point is that this borrowing permission is not available to standard defined contribution employer schemes, regardless of size.

Among the options, the one-member SSAPS is the structure that fits this borrowing exception. A DC employer scheme, whether for 2–99 or 100+ members, would not have the authority to borrow long-term for investment under normal rules. Therefore, the trustees of the one-member SSAPS can borrow for long-term investment, making it the best answer.