Draft Clearance Guidance

Sacker & Partners LLP has responded to the Pensions Regulator`s consultation on the Draft Clearance Guidance published on 10 September 2007. Clearance is intended to be a voluntary process, however we note there is increasing pressure on companies to apply for clearance. The draft guidance suggests that trustees should in effect blow the whistle to TPR if clearance is not being sought. Although the original intention was as a guide for companies in order to establish whether they should apply for clearance (and to outline the process for doing so), we understand that the guidance now “focuses on [TPR’s] expectations of professional advisers working with trustees and employers in considering events that may have a detrimental impact upon a pension scheme”. Therefore, it now seems to be designed as a negotiating tool.