Pensions Weekly Update – 26 October 2022

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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.

It has been a week of political upheaval. The new Prime Minister, Rishi Sunak, recognises the “profound economic challenge” ahead and is seeking stability. However, trustees should continue to be mindful of economic uncertainty and ensure that internal governance processes around investment decision-making are robust and efficient. The Chancellor (confirmed as Jeremy Hunt) plans to announce further changes to fiscal policy on 17 November 2022. It is also expected that the commitment to the triple lock applying to increases in the state pension will be honoured, in line with the Conservative Party’s manifesto promise in 2019.
The Rt Hon Mel Stride has been appointed as the new Secretary of State for Work and Pensions. He succeeds Chloe Smith, who occupied the post for seven weeks.
The Work and Pensions Committee has launched an inquiry into defined benefit (DB) pensions with liability-driven investments (LDI). The inquiry will be looking to explore the lessons learned from recent volatility in the gilt markets, whether LDI is still “fit for purpose” for use by DB schemes, whether The Pensions Regulator (TPR) has taken the right approach to regulating and monitoring LDI arrangements and whether trustees had adequate governance arrangements in place. There is a call for evidence to inform the inquiry, which closes on 15 November 2022.
TPR has published its enforcement strategy, its consolidated enforcement policy and an updated prosecution policy, alongside the response to consultation carried out earlier this year. The policies have been updated to reflect the new powers given to TPR under the Pension Schemes Act 2021. TPR’s new documents and approach are explained further in a blog.
In the run up to Halloween, let us pose the traditional question, “Trick or treat?” In answer, you will always find some pensions treats (but sadly not chocolate) in our pensions thought leadership library.