As promised, The Pensions Regulator (TPR) has been raising its voice since publishing its 2018-2021 corporate plan setting out how it will be “more vocal” in its “clearer, quicker and tougher approach” to driving up standards in the pensions sector. Our blog examines TPR’s recent activity. Continue Reading
The DWP is consulting on new powers for The Pensions Regulator (TPR). The consultation covers:
- Notifiable events framework
- Declaration of intent (new)
- Voluntary clearance
- Engagement with other regulators
- Contribution notices and financial support directions
Of particular note are the new civil and criminal sanctions. The DWP is proposing that TPR should be able to issue a civil fine of up to £1 million and that unlimited fines and custodial sentences would be available under criminal sanctions. Anybody could fall foul of the new fines – employers, directors, connected and associated persons and even pension trustees.
Insolvency professionals will be particularly concerned by one of the proposed new notifiable events, which would be triggered when a sponsoring employer takes independent pre-appointment insolvency or restructuring advice. For further reading, please click here.
“You need to get the basics right, including giving us up-to-date information about the scheme, and we will take action if you fail.” The Pensions Regulator’s (TPR) move towards being a “clearer, quicker and tougher regulator” is apparent from this statement, taken from its most recently published compliance and enforcement bulletin.
TPR has recently fined the trustees of an unnamed pension plan for failing to comply with s.62 of the Pensions Act 2004, which requires trustees to “take all reasonable steps” to notify it of changes to registrable information “as soon as reasonably practicable”. In this case, the trustees had failed to notify TPR of the appointment of a professional trustee, which came to light after an investigation was opened following a failure to submit the scheme return. Continue Reading
The writing may not always be on the wall in terms of validating scheme amendments where historic documentation is scarce and in terms of recovering overpayments to pensions. An interesting case involving the BIC UK Pension Scheme (yes, “BIC” as in the pen that you may be holding) highlights a new way forward for trustees struggling with limitation periods and gives further hope to schemes wanting to rely on employer agreement to changes that took place in times of more informal recording keeping. Continue Reading
There’s good news and not so good news about the impact of anti-money laundering (AML) requirements on pension plans.
Okay, so this is a slight exaggeration. There is definitely good news. The not so good news is only potentially not so good news and, given the new direction of travel of HMRC, it may even prove to be “fake” news. Whether this is the case remains to be seen but read on for the latest on the further evolution of the newest compliance burden facing pension plan trustees.
Since 6 April 2018 companies have been unable to grant new EMI options, because the existing EU state aid approval expired without fresh approval having been received.
So there has been much excitement today at the news that the EU Commission has now given state aid approval, and companies can now grant new EMI options. For companies that granted EMI options since 6 April (e.g. as part of a commercial transaction which could not be delayed) the wait continues as the EU Commission’s press release does not state the date from which their approval applies. We expect this will be indicated in the EU Commission’s formal decision, which has not yet been published. For the majority though, it’s good news and a welcome return to “business as usual”.
The state aid approval will apply as long as the UK is an EU member state, and the EU Commission has indicated that long-term approval of the EMI scheme will need to be dealt with in the EU withdrawal agreement.
…none of them were hurt, but a bump on the head made them even more confused about their pension rights.
My colleagues in the Squire Patton Boggs immigration team are being asked by concerned employees: “What will happen to my pension after Brexit?” The answer is likely to depend, for private pension, on what your arrangement currently allows and, for the UK State Pension, where you reside (whether you live in England (i.e. the UK), France (i.e. the EU) or Canada (i.e. elsewhere in the world)).
If I ever claimed to be an expert on IT systems and processes, those who work in our firm’s IT department would struggle to contain their amusement.
Along with many other forty-somethings, I am a proficient user of IT at work and at home – until something goes wrong. Then I find it frustrating because I realise that I am pretty clueless about how everything really works; in fact, I need an expert to put it right so that I can go back to pressing buttons and swiping screens to my heart’s content. I suspect that many pension plan trustees are in a similar place.
The Pensions Regulator’s recent guidance on cybersecurity leaves me feeling cold because it confirms the stark reality that one weak link in any chain may spell reputational or financial disaster for a pension plan. It seems like a very difficult thing to protect against.
To celebrate the new tax year, we provide a round-up of some of the pensions measures that come into force on 6 April 2018.
Bulk transfer without consent of DC benefits
At last, trustees and employers can close an occupational money purchase (DC) plan without the pension plan actuary having to decide how the certification requirement under the preservation regulations operates in the context of a DC bulk transfer. By way of a reminder, before 6 April 2018, an actuary had to certify that “the transfer credits to be acquired for each member under the receiving scheme in the categories of member covered by this certificate are, broadly, no less favourable than the rights to be transferred.” Did this mean, for example, that the actuary was expected to consider the charging structure in the receiving plan? Instead, trustees can reach their own assessment as to the suitability of the receiving plan. If the receiving plan is not an authorised master trust then the trustees must take investment advice from an adviser who is independent of the receiving plan. Broadly speaking, an adviser will be “independent” if he has not provided advisory, administration or investment services to the receiving plan, service provider or sponsoring employer or a connected firm in the preceding year before the transfer takes place.
Do we think this will assist clients? YES Continue Reading
The vagaries of EU State Aid approvals probably pass most of us by. However, they have come centre stage for many SMEs with HMRC’s announcement that it is not expected that an extension to the UK’s existing State Aid approval for EMI options will be granted before 6th April, when the current approval expires.
HMRC has warned that options granted after that date but before any new approval is given may not qualify for the considerable tax advantages associated with EMI options (and so may instead be treated as non-tax advantaged employment-related securities options).