Pensions Bill revisited by parliament
08 January 2020
The Pensions Bill, first referenced in the initial Queen’s Speech held in October 2019, and reiterated by the Queen in December, has been reintroduced into parliament, following its delay as a result of the general election.
As parliament reopened following the Christmas break, the policy was placed in the House of Lords and includes plans for the implementation of pensions dashboards, strengthened powers for The Pensions Regulator (TPR) and the introduction of collective defined contribution schemes.
Prior to the election, the Pensions Bill had already attracted cross-party support and it was widely anticipated that it would be revisited once the election had passed.
The Financial Adviser reported that the chief executive of TPR, Charles Counsell, pledged his support for the Pensions Bill and was pleased that it was being reintroduced so swiftly. He confirmed that he was looking forward to working alongside the Department for Work and Pensions (DWP) as the bill progressed. He commented that the new bill would mean that the regulator could be “clearer, quicker and tougher” and that it would have more power to reprimand and punish any “risky and reckless” behaviour.
The new powers that will be awarded to TPR within the bill include making it a criminal offence to behave in a knowingly reckless manner, which can carry a custodial sentence of up to seven years for the responsible bosses. TPR can also gather information about schemes within a timely manner so that it can recover any damages for members of pension schemes when things are not done correctly so that they are not negatively impacted.
Pensions dashboards have been on the agenda for a considerable time now and will allow savers to see all their pension pots consolidated in one area, alongside information relating to their state pension. It is hoped that this will assist people in better preparing for their retirement and to give them some insight into the lifestyle they can expect to lead.
Collective defined contribution schemes are also referenced in the bill. These schemes do not guarantee a certain pension income but have a target figure that they will pay out which is based on a long-term, mixed risk investment plan. Under defined contribution schemes, there are no individual pension pots, but members pay into a collective pot which pays out to individuals during retirement.
The CIPP will keep its members updated as to any movements and progress in relation to the Pensions Bills via News Online.
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