Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes that you might have missed, with links for further information.
The government has published its anticipated review of the state pension age, in which it confirms that state pension ages will increase to age 67 between 2026 and 2028, as planned. The increase to age 68, scheduled to take place between 2044 and 2046, will be reviewed again within two years of the next parliament.
The Pensions Administration Standards Association (PASA) has issued new guidance on pensions dashboards. The new data matching guidance covers how to match an individual who does not have (or does not provide) a national insurance number and also how to deal with partial matches. PASA has also issued guidance suggesting standard responses that administrators and pension providers can give to members who enquire about dashboards’ availability and function.
The government has published its Green Finance Strategy 2023. This builds on its green finance strategy published in 2019. The new and updated strategy sets out how the government will mobilise the investment (including from private finance, such as pension funds) that is needed to meet its climate and nature objectives. It notes that private investment will be needed in order to deliver on the UK’s net zero ambitions, with an estimated additional £50-60 billion capital investment being required each year during the 2020s and 2030s. The 130-page strategy covers many topics. Of particular interest to pension funds is that the government intends liaising with The Pensions Regulator to review the regulatory framework for effective stewardship, and the Department for Work and Pensions (DWP) will examine the extent to which its stewardship guidance is being followed in late 2023. This will be complemented by a working group of the Financial Markets and Law Committee where participants, including the DWP, will consider the issues around fiduciary duties for pension trustees. The working group will revisit the extent to which pension trustees are able to take into account non-financial factors when making investment choices.
The Taskforce for Nature-related Financial Disclosures (TNFD) has launched its fourth and final beta framework for nature-related risk management and disclosure. Interested parties will be able to see the full framework for the first time. Like the Taskforce on Climate-related Financial Disclosure offering, it is a framework and not a standard. The TNFD invites feedback on the final form of the framework by 1 June 2023 and says that it is on track to publish its final recommendations in September 2023.
The Pensions and Lifetime Savings Association has issued its Stewardship & Voting Guidelines 2023. The guidelines are designed to help trustees and other investors to decide how to exercise their vote at annual general meetings.
The Pension Protection Fund (PPF) has published its outcome of consultation in relation to the assumptions used in section 143 and 179 valuations. The PPF will proceed with its proposals to change the assumptions it uses for certain valuations that provide an estimated price for bulk annuity providers in the buyout market. It says that the changes to the assumptions will ensure that those schemes that may be able to secure benefits above PPF levels are given the opportunity to test the market. The new assumptions will take effect from 1 May 2023. The PPF has updated the valuation guidance on its website.
We plan to take a short break next week due to the Easter holidays. Fingers crossed for some pleasant weather over the UK bank holiday weekend! The weekly update will be back on Wednesday 19 April.
If you would like specific advice on any of these issues, or on anything else, please contact a member of our Pensions team.