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
- TPR publishes blog on trustee engagement when sponsoring employers are in difficulty
- Updated Data Protection and Digital Information Bill reintroduced to Parliament
- Consultations on implementing second part of the McCloud remedy published
- Pension increase rate for GMPs published
- DWP responds to consultation on technical amendments to the PPF and Fraud Compensation Fund (“FCF”) Regulations
- Private Member’s Bill on pension contributions introduced to Parliament
TPR publishes blog on trustee engagement when sponsoring employers are in difficulty
On 8 March 2023, TPR published a blog setting out its expectations of trustees engaging with TPR when their scheme’s sponsoring employer is in difficulty. The blog will be relevant for trustees who may be concerned their sponsor is struggling financially, or who are already involved in discussions about a restructuring plan, a company voluntary arrangement or other form of restructuring or insolvency process.
TPR expects trustees to consider several key factors where their sponsor is challenged, including having a “comprehensive financial information-sharing package”, and involving TPR at an early stage, for example, when it becomes clear that trading for a sponsoring employer is challenged or if the viability of a company is uncertain. TPR emphasises that early engagement can assist in achieving “robust settlements with other creditors”, and ensuring “the best outcomes for savers is achieved”.
Updated Data Protection and Digital Information Bill reintroduced to Parliament
The Data Protection and Digital Information Bill first introduced to Parliament in July 2022 was reintroduced on 8 March 2023 in a revised form, as the Data Protection and Digital Information (No. 2) Bill. The Bill is intended to update and simplify data protection requirements in the UK (see 7 Days for details of the reforms originally proposed). The changes to the earlier text include limiting the requirement to keep data processing records so that it applies only to organisations whose processing activities “are likely to pose high risks to individual’s rights and freedoms”. The reintroduction was welcomed by the ICO, which is working with the Government “to monitor how these reforms are expressed in the Bill”.
Consultations on implementing second part of the McCloud remedy published
The Government’s implementation of the McCloud judgment (see 7 Days) continues. Several consultations have been published on implementing the second part of the remedy, which concerns discrimination that occurred in the period 1 April 2015 to 31 March 2022. The consultations relate to the Police Pension Scheme, the Firefighters’ Pension Scheme, the Civil Service Pension Scheme and the Armed Forces Pension Scheme. The consultations will each close during May 2023, with the changes intended to come into effect from 1 October 2023.
Pension increase rate for GMPs published
The Guaranteed Minimum Pensions Increase Order 2023 was made on 6 March 2023 and specifies 3% as the percentage by which that part of GMPs attributable to earnings factors for the years 1988-89 and 1996-97 is to be increased from 6 April 2023.
DWP responds to consultation on technical amendments to the PPF and Fraud Compensation Fund (“FCF”) Regulations
On 7 March 2023, the DWP published a response to its consultation on two technical changes to the PPF and FCF regulations. The response confirmed it will proceed with changes intended to:
- enable the PPF to make an interim payment to cover scheme fees and costs while FCF claims are progressed, and
- change PPF provisions regarding child pensions, so that a gap in full-time education of more than one year (such as a “gap year” between school and university) does not result in the loss of PPF compensation.
The regulations implementing the changes come into force on 6 April 2023.
Private Member’s Bill on pension contributions introduced to Parliament
A Private Members’ Bill to require employers to pay pension contributions into a pension scheme of the employee’s choosing was introduced to Parliament on 7 March 2023. The Bill is intended to help reduce the number of deferred pension pots by enabling employees to have a “pot for life”. Its second reading is scheduled for 17 March 2023.
The DWP is currently calling for evidence on potential solutions to reduce the number of small deferred pots across the industry (see our Alert for more details). The call for evidence closes on 27 March 2023.