This month, we discuss developments ranging from the Autumn Statement to COP27. We also tell you how you can get a copy of our Q1 2023 pensions action plan, which covers a number of other areas.
If you would like to discuss any of the changes in this newsletter, please contact one of the experts listed at the end of this update.
Autumn Statement | Guest houses
On 17 November, the chancellor delivered his Autumn Statement 2022. For pensions, the key points were as follows:
- No changes (or increases) were announced to the annual allowance or the money purchase annual allowance; nor did the chancellor announce any change to the current policy that the lifetime allowance will remain at its 2020-21 level of £1,073,100 until 5 April 2026. This is good news in some respects, but is likely to mean that more and more people will be affected by the limits.
- The government is going to”continue to champion institutional investment into innovation so that UK savers can benefit from the growth of high potential businesses.” Investment in infrastructure also remains a key theme.
- The State Pension will be uprated by Consumer Prices Index inflation, in line with the commitment (seemingly after some deliberation) to keep the triple lock, and the government’s review of the State Pension age will be published in early 2023.”The Review will need to carefully balance important factors, including fiscal sustainability, the economic context, the latest life expectancy data and fairness both to pensioners and taxpayers.”
The government has also published a consultation response setting out the final reforms of Solvency II. It states: “These reforms will unlock tens of billions of pounds for investment across a range of sectors.”
For a wider look at the tax measures announced by the chancellor, you might like to read our Insight.
Decarbonisation | COP27
Pension funds might like to read our Insights on the COP27 climate conference, which took place in Egypt between 6 and 18 November:
SingleCode | Update on timing
The Pensions Regulator is reported to have said, at a recent conference, that it hopes its new single Code of Practice (which will have governance implications for all funds) will be laid in Parliament “towards the end of this year or the beginning of January2023.
Automatic enrollment | 10 years and counting
The Department for Work and Pensions has celebrated the recent 10th anniversary of automatic enrollment. In a press release, it confirms its commitment to introducing mid-life “MOTs” and confirms that the government is “exploring how Automatic Enrolment can go even further to help more people save more, sooner – by abolishing the Lower Earnings Limit for contributions and reducing the eligible age to 18″.
The Pensions Ombudsman | Determination fact sheet
The Pensions Regulator has published a determinations factsheet. The factsheet is essential reading for anyone who deals with Pensions Ombudsman complaints.
Other developments | Q1 2023 Pensions Action Plan
We have released our Q1 2023 Pensions Action Plan. Each action plan is a summary of changes and proposals in pensions law and regulation over the last quarter, most of which are also relevant to public sector pension schemes.
Topics covered include:
- pensions dashboard developments;
- a recent High Court decision which has implications for recoupment of overpayments;
- pension scams (please see now this press release);
- contract provisions covering a change of scheme administrator; and
- equality, diversity and inclusion in governing bodies.
To receive your copy of the Action Plan, please ask your usual Osborne Clarke contact.
Guest Houses Ombudsman | Various
The Pensions Ombudsman (TPO) has confirmed that, when considering whether a scheme completed adequate due diligence before making a transfer, the position must not be looked at with the benefit of hindsight. it”is the circumstances at the time of the transfer which are of importance“. In this case, the adjudicator also referred to the fact that the 2015 Pensions Scams Industry Group’s code of good practice had been in place for less than a month at the time of the transfer and that it was reasonable to allow the scheme time to implement any changes: in “previous Determinations by the Pensions Ombudsman a three-month period had been considered a reasonable timeframe in which to do this“.
TPO has not upheld a complaint by a member of the Police Pension Scheme 1987 that he did not receive pension payments made to a bank in Turkey between December 2015 and July 2016 (nearly £17,000 in total).
The scheme was paying Dr K’s pension installations into a bank in Belize. Dr K then asked for payments to be made to an account with a Turkish bank. It looks from the decision as though Dr K had instructed the Turkish bank to transfer payments, once received, on to the account in Belize.
The scheme made the December to July payments to the Turkish bank as instructed, but the money did not reach Dr K’s account in Belize. When Dr K approached the Turkish bank, it told him that it was for the Police Pension Scheme to trace the payments. The Police Pension Scheme had proof that the payments had been made to the Turkish bank in line with Dr K’s instructions. It also contacted the Turkish Bank to try to find out what had happened, but was told that Turkish banking law prohibited the release of information to third parties.
The Pensions Ombudsman confirmed that the scheme could not be held responsible for the fact that the payments had not reached Dr K. It had made the payments in accordance with his instructions and had made reasonable attempts to find out what had happened.
House of Commons Library briefing papers | New and updated
The House of Commons library has published or updated the following briefing papers, which might be of interest to public service pension schemes and employers.
This newsletter covers developments relating to public service pensions in England and Wales, with a focus on the Local Government Pension Scheme.