Current Issues –June 2024         

General Election – 4^th July:  On 22^nd May, the Prime Minister announced that a general election will be held on 4^th July, the outcome of which should be known by the time of our next newsletter. At the time of writing, the Labour Party are ahead in opinion polls. The Labour Party has said that it would reintroduce the Lifetime Allowance, which was abolished this year. However, it is now reported that the Labour Party has dropped this plan largely as a result of lobbying from senior NHS staff and unions.

The DWP were expected to lay the Code of Practice for the new DB funding regime in June, so that it would be in force by 22^nd September, when the regime comes into force. It remains to be seen whether the Code of Practice will be introduced in time. The dissolution of Parliament means that a number of initiatives and responses to consultations will be put on hold. These include,  the Mansion House proposals aimed at getting more pension investment in growth assets,  regulations for DB superfunds, refunds to employers in ongoing schemes, and the possible role of the PPF as a DB consolidator.

In early election campaigning, the Conservative Party announced that it would increase the tax-free personal allowance for pensioners, in line with the pensions triple-lock, if they win. The standard personal allowance of £12,570 p.a. has been frozen since April 2021 and is due to remain frozen until 2027/28. There is concern that pensioners receiving only state pension may have to start paying tax and filling in tax-returns.

.HMRC Newsletter:HMRC has published its latest pension schemes newsletter, which can be found here:  HMRC Newsletter 160.  The newsletter covers more guidance on the abolition of the LTA and how to raise queries with Pension Scheme Services. HMRC now has a tool for members to check if they can apply for a transitional tax-free amount certificate. HMRC has reminded trustees and administrators that from April next year, pension scheme returns must be submitted on the Managing Pension Schemes service, rather than on Pension Schemes Online, as is currently the case.

Data Quality – TPR urges action:    TPR has published a blog which highlights the importance of data quality for pension dashboards. TPR has noted that failure to meet deadlines is not acceptable. TPR intends to contact hundreds of schemes to see how they are measuring and improving data. Enforcement action can be expected if schemes do not meet expectations.

Pensions Ombudsman – Plans to reduce waiting times : Robert Loughlin, the new Chief Operating Officer at the Pensions Ombudsman, has announced plans to address historical caseloads and reduce waiting times. Key changes include tightening complaint investigation conditions, extending expedited determinations, and exploring new acceptance thresholds. The full programme aims for significant improvements over the next three years, with notable progress expected within 12-18 months. Complainants can currently approach the Ombudsman’s ‘early resolution’ team before using a scheme’s complaint procedures. The proposed changes mean that those making a complaint will need to have exhausted their options under a scheme’s ‘internal disputes resolution procedure’ first.

TPR – Remit may expand:  The Pensions Regulator (TPR) is in discussions with the government to extend its remit to include pension scheme administrators. Meanwhile, TPR has developed a voluntary supervisory regime with major administrators and is exploring similar plans for professional trustees. This initiative aims to address challenges and risks within the industry.