7 days

7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.

In this 7 Days

Briefing paper on inheriting pension rights

The House of Commons Library has published a briefing paper on inheriting pension rights, which provides an overview of the development of the different arrangements for inheriting pension rights in state and private pension schemes.

DfE consults on draft amendments to Teachers’ Pension Scheme rules

On 7 April 2021, the Department for Education (“DfE”) launched a consultation seeking views on the draft amendments to the Teachers’ Pension Scheme (“TPS”) to amend survivor benefits and introduce phased withdrawal of independent schools.

The proposed amendments to survivor benefits follow a written ministerial statement in July 2020 announcing that, following the decision of the Employment Tribunal in Goodwin v Secretary of State for Education, changes would be made to public sector pension schemes to prevent direct sexual orientation discrimination in circumstances where the husband or male civil partner of a female scheme member is entitled to lower survivor benefits than a comparable same-sex survivor (see 7 Days).

The proposed amendments to introduce phased withdrawal of independent schools follow the Government’s announcement in November 2020 that it would allow them to opt out of TPS participation for future teaching staff while allowing existing staff to remain active members (see 7 Days).

The consultation will close on 1 June 2021.

OBR publish supplementary forecast information on state pensions underpayment correction

Following the publication of the OBR’s latest Economic and Fiscal Outlook report, which found that it will cost around £3bn to address state pension underpayments (see 7 Days), on 1 April 2021 the OBR published supplementary forecast information on the “state pensions underpayment correction” measure. According to the information, widowed retirees are forecast to be owed an average arrears payment of £17,000, whilst more than 74,000 married women are expected to receive £23,000 in underpaid state pensions. The Government is expected to pay £570m every year until 2026 to account for the loss of income.

Further groups of women who may be entitled to refunds are in the process of being identified.

TPR publishes new climate change strategy

On 7 April 2021, TPR published a new climate change strategy calling on scheme trustees to “act now to protect savers from climate risk”. The strategy aims to outline how TPR will help occupational pension schemes to comply with proposed regulations requiring trustees of larger schemes to maintain oversight of, and make mandatory disclosures in relation to, climate risks.

The strategy outlines TPR’s expectations that all scheme trustees will comply with existing requirements to publish their SIP, including policies on stewardship and ESG matters, alongside their implementation statement. TPR says “these disclosures represent compliance with the basics on climate change”. It will take enforcement action where appropriate, and which may be publicised.

TPR notes that current guidance will be reviewed and updated “where regulation has moved on”. It plans to publish additional guidance “later this year”, following engagement with industry, “to help schemes comply with the new legislation and make consideration of climate change risks and opportunities part of their systems of governance”.

TPR updates guidance on AE and DC pension contributions

On 9 April 2021, TPR updated its COVID-19 guidance on automatic enrolment and DC pension contributions to incorporate changes to the Coronavirus Job Retention Scheme (“CJRS”) and wider government support announced in March 2021. On 3 March 2021, the Chancellor announced at the Budget that the CJRS would be extended for a further five months from May until the end of September 2021 (see 7 Days).

TPR webinar on pledge to combat pension scams

On 8 April 2021, TPR posted its pledge to combat pension scams webinar designed to support the pensions industry to make a Pledge to Combat Pension Scams.

Pensions Minister, Guy Opperman, has also warned that “the Government is working closely with its partners on the best ways to combat, and raise awareness of, pension fraud”. In line with the findings in the recent WPC report on protecting pension savers (see 7 Days), he asked tech companies to “do more to crack down on scam adverts and … use their existing powers to verify advertisers and stop taking money from fraudsters.”