Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes, which you might have missed, with links for further information.
The Pensions Regulator (TPR) has issued its annual funding statement, which is particularly relevant for defined benefit schemes with valuation dates between 22 September 2021 and 21 September 2022. The statement highlights the significant economic uncertainties stemming from high inflation rates, increasing energy and fuel prices, increasing interest rates, the conflict in Ukraine, and the lingering effects of COVID-19 and Brexit on some businesses. Trustees should continue to monitor shareholder distributions, be vigilant to all forms of covenant leakage and focus on their journey towards the scheme’s long-term funding target.
The Pension Schemes (Conversion of Guaranteed Minimum Pensions) Act 2022, which was a private member's bill that gained government support, has received Royal Assent and become an Act of Parliament. At the time of writing, the final version of the Act is not available. The latest version of the bill that was debated in Parliament clarifies the existing legislation in relation to the conversion of guaranteed minimum pensions (GMPs). This includes clarification that the legislation also applies to survivors, clarification of the entities that must consent to GMP conversion (i.e. which employer(s)) and the removal of the requirement to notify HMRC of GMP conversion. The bill also provides that the main provisions of the Act will come into force from a date to be specified by regulations.
The Pensions Dashboards Programme (PDP) has published its progress update for the six months to April 2022. This update also contains the PDP’s plans for the next six months. The update notes that the Department for Work and Pensions plans to publish its outcome of consultation on the draft regulations for dashboards in the summer, following which it will lay the regulations as soon as parliamentary time allows. The PDP says that it plans to carry out a consultation on the data, technical, reporting and design standards in relation to pensions dashboards in summer 2022.
HMRC has published pension schemes newsletter 138, which contains some timing reminders, including information about the changes to the Scheme Pays deadlines. The newsletter also includes information about migrating schemes from pension schemes online to the new managing pension schemes service. Trustees should allow plenty of time to do the migration – do not assume that your scheme administrators will automatically be able to do this for you – check that they have it in hand.
Congratulations to Matthew Giles, who took over as practice group leader of the firm’s Pensions team on 1 May, following the sterling work of Clifford Sims in this role. Congratulations also to Kate Bailey and Chris Harper, who have become partners in the Pensions team. Kate is based in the team’s Birmingham office, while Chris is based in London.
If you would like specific advice on any of these issues, or on anything else, please contact a member of our Pensions team.