Private pension schemes are based on net pension. This means that the benefits from the pension plan are coordinated with the National insurance scheme paid on retirement. In other words there is no coordination between the National insurance scheme and private pension schemes. The net pension scheme does not ensure total payments in the same way as the gross scheme. If the payment from the National insurance scheme paid on retirement goes down, the total pension payments go down accordingly. Net pension plans can be defined benefit or defined contribution. For defined benefit schemes the pension is normally determined as a percentage of final salary, as either a gross level including the National insurance scheme or as a net addition to the National insurance scheme. Contribution schemes are a retirement plan where the employer pays an annual agreed deposit, normally as a percentage of salary.