19 March 2018
Protecting Defined Benefits Pension Schemes
The much-anticipated white paper, titled Protecting Defined Benefits Benefits Schemes is here. The Department of Work & Pensions (DWP) said it would work to improve “the effectiveness and efficiency” of the Pension Regulator’s existing anti-avoidance powers while ensuring they do not have “an adverse effect on legitimate business activity and the wider economy”.
This will include strengthening the watchdog’s information-gathering powers, “supported by penalties to drive co-operation”, such as requiring attendance at interviews, civil sanctions for non-compliance with section 72 notices – adding to existing criminal sanctions – and inspection powers, “harmonising powers” it already has for auto-enrolment and master trust schemes.
However, former Pensions Minister Steve Webb says the proposals lack teeth, with convictions likely to be difficult to achieve. He and other industry analysts have criticised the proposed pace of legislative reform. The TUC has described the paper as a missed opportunity to protect pensions. The Association of Consulting Actuaries has criticised the White Paper for not doing anything to help employers struggling with heavy DB burdens. But other industry figures have welcomed the extra powers that the proposed legislation will create.
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