Pensions Regulator: revised DB funding code approach. The Regulator will look to introduce a twin-track approach to demonstrate the increasing need to reconcile the objectives of greater direction and continued flexibility of pension schemes by introducing the Fast Track route (likely to be used by small schemes with fewer than 100 members) and the Bespoke route (which will provide more flexibility but schemes will be subject to greater scrutiny). Two formal consultations are intended, which the Regulator has indicated will be in the new year.
Pensions Regulator: multi-employer scheme employer departure guidance updated. This guidance for trustees and employers about managing employer debts that arise when an employer departs a multi-employer scheme now includes information on deferred debt arrangements (DDAs). DDAS were previously introduced in 2012 but the guidance has been updated to reflect that trustees must notify the Regulator "as soon as reasonably practicable" if entering into or terminating a DDA or if they become aware of a DDA taking effect or coming to an end. See guidance
Investment Association: new executive pensions guidelines issued. These warn companies to set out their plans for paying executive directors the same pension contributions as the majority of their workforce by 2022, or risk further shareholder dissent. Companies paying more than 25% as contributions will be given the highest level of warning if they fail to set out a credible plan. See announcement
Pensions Regulator: data reviews as part of wider move to improve governance standards and member outcomes. 400 schemes have been asked to review and report back on their scheme data within the next six months as part of a crackdown on poor record-keeping, and they will need to draw up an improvement plan to rectify any poor quality data. The Regulator will also be writing to 1000 schemes on issues such as lengths of recovery plans and dividend payments to shareholders. See announcement
Pensions Regulator: 7th and last auto-enrolment commentary and analysis. Over the April 2018/March 2019. period the Regulator received declarations of compliance from 311,401 employers, and a total of over 10 million jobholders have been auto-enrolled since 2012. However, the Regulator has used its formal powers more over this last year than previously and it will be looking to continue to engage with employers to ensure prompt payment of contributions. See document
Pensions Regulator: no deal Brexit guidance for cross-border schemes. This is intended to assist employers and trustees of the 40 UK cross-border schemes if the UK leaves the EU without a withdrawal agreement. See guidance
DWP: consultation on increasing pension scheme general levy. This levy falls on both occupational and personal pension schemes, with charges varying according to scheme member numbers. Rates have generally remained the same since 2012/13 and the DWP intends to increase these for 2020/21 via four possible options. The consultation closes 15 November. See consultation
Normal pension age equalisation: levelling down prohibited by EU law unless exceptional circumstances. In Safeway v Newton the ECJ held that EU law prevented the scheme from retrospectively equalising the NPA of members to that of the persons within the previously advantaged category. Instead, all other members needed to be levelled up until the point the scheme had closed the Barber window. Once closed, the scheme had the option to level back down.
High Court: failure in judicial review of state pension age increases for women. The claim that there was little time for women to adjust to the extra years without a state pension when it was moved from age 60 to 65 and that this was unlawful age and sex discrimination was dismissed by the High Court. The Court held that even if there had been discrimination, it could be justified as the legislation had a legitimate foundation and purpose.
Pensions Ombudsman: joint and several liability for principal firm and its appointed financial adviser in relation to transfer delay. A complaint of maladministration has been upheld relating to the delay in processing the member's transfer request which caused her guaranteed transfer value deadline to be missed and resulted in a £25,321 lower cash equivalent transfer value. The principal firm was formally dissolved shortly after the Ombudsman's decision so it then found the financial adviser jointly and severally liable.
Upcoming key 2019/early 2020 dates:
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