Protecting defined benefit pension schemes - a stronger Pensions Regulator
28 June 2018
A consultation has been published to help increase the protections of defined benefit scheme members. Proposals include up to a £1,000,000 penalty and a possible custodial sentence for those who act recklessly with their company pension scheme.
In March 2018, the government published the White Paper ‘Protecting Defined Benefit Pension Schemes’. In the White Paper, it stated that the existing system is working well for the majority of Defined Benefit pension schemes, members, trustees and sponsoring employers but that there are ways in which the system could be improved further.
The White Paper said that “There are a number of measures where, although we have an agreement about what needs doing, more work is required to build consensus about the best way to deliver our aims and to design the detail of our proposals. We will be consulting further on these areas.”
As a part of this process, the Department for Work and Pensions (DWP) will be carrying out a number of consultations focussed on different areas. This is the first of these consultations and sets out the proposals to improve the Pensions Regulator’s powers so that they:
Can be more proactive and get involved earlier when employers make changes which could impact the pension scheme
Can obtain the right information about a scheme and its sponsoring employer
Are able to gain redress when things go wrong
The DWP state that this is an opportunity to strengthen protection for Defined Benefit pensions, and it is extremely important to get the changes right. The DWP is, therefore, asking for views on its proposals before it implements them and is keen to hear from anyone with an interest in these areas.
The consultation ‘Protecting defined benefit pension schemes – a stronger Pensions Regulator’ closes on 21 August 2018.