On February 17, 2015, HM Treasury published the final draft Financial Services and Markets Act 2000 (Banking Reform) (Pensions) Regulations together with its response to its consultation on the draft Regulations. The aim of the Regulations is to impose requirements on the pension liabilities of ring-fenced banks to ensure they are not liable for pension schemes of other group entities (except in cases that are specifically prescribed by the Treasury). The draft Regulations provide a framework in which existing pension arrangements can be restructured so that they are aligned with the requirements. In the consultation response, HM Treasury sets out its policy decisions and addresses concerns raised by the respondents, stating that banks would now have to apply for a clearance statement from the Pension Regulator only if changes are likely to be materially detrimental to the scheme and its members. The consultation response also states there is no general provision for transitional tax protections for employees in the Regulations at present but it commits to addressing such issues once it has a better understanding of how banks will implement the ring fence and the nature of any detrimental impact on individuals as a result of scheme changes. The final draft Regulations have now been put before Parliament.
The consultation response is available at: https://www.gov.uk/government/uploads/system/uploads/ attachment_data/file/404639/banking_reform_response_to_consultation_on_draft_pensions_regulations.pdf and the final regulations are available at: http://www.legislation.gov.uk/ukdsi/2015/9780111127667/pdfs/ukdsi_9780111127667_en.pdf.
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