Debt illustrations are starting to land on the desks of employers who have historically participated in the Plumbing & Mechanical Services (UK) Industry Pension Scheme (“the Plumbing Scheme”).
Together with Chris Hawley of Barnett Waddingham, we explore the arising issues and what challenges are open to these employers.
The challenges facing the Plumbing Scheme surrounding historic section 75 exit debts have been well publicised. Essentially, due to a lack of information in historic records regarding employment history, the Plumbing Scheme has not been able to calculate and issue debts to employers who have ceased to participate in the Scheme since September 2005.
The Trustee of the Plumbing Scheme has explained that it has spent a lot of time lobbying and communicating with the various regulatory powers about way the section 75 debt is applied. After several years – in 2014, the Trustee started work with its advisers on the process to begin calculating and recovering section 75 exit debts.
More recently, there has been multiple consultations with employers about the method for calculating the debts. The Plumbing Scheme has now started issuing indicative debt amounts, giving employers a period of 6 weeks to challenge the calculation and amounts, as well as opportunities to discuss payment options before a formal debt is issued to the employer. Continue Reading