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
- Government publishes response to consultation on draft age exception order
- TPAS publishes Spotlight on DB pensions
Some occupational pension schemes currently pay one rate of pension when a member reaches pensionable age under the scheme, and a reduced rate when the member reaches State Pension age, in order to take account of the State Pension the member receives. These are commonly known as “bridging pensions”. Provisions in the Equality Act (Age Exceptions for Pension Schemes) Order 2010 (“the 2010 Order”) permit schemes to do this. However, the current exemption did not contemplate the gradual rise in SPA to age 68 which has been in progress since 6 December 2018.
The Order makes a technical change to the 2010 Order to allow schemes to take into account a member’s State Pension when calculating the occupational pension payable, where the member has a State Pension age later than age 65. It also makes some further technical changes.
The Order was were laid before Parliament on the same day, and comes into force on 15 May 2019. The Order does not have retrospective effect.
TPAS has published a Spotlight document on DB pensions, called “How secure is my pension?”. The factsheet aims to answer some common questions that pension scheme members have been putting to TPAS, outlining the funding issues surrounding DB pensions, the safeguards in place and the guarantees attached to scheme benefits.