What’s coming up in Pensions

The new Public Service Pensions and Judicial Offices Act aims, among other things, to "ensure equal treatment for all members" and start to remedy the unlawful age discrimination identified by the Court of Appeal in the McCloud judgment.

Following a raft of underlying regulations, active members of the teachers’, civil service, firefighters’, police, armed forces’ and NHS pension schemes accrue pensionable service in reformed schemes, with the legacy schemes being closed, from 1 April 2022.

Changes to the Judicial pension schemes and the LGPS were consulted on separately, and also took effect from 1 April.

Watch out for further consultation expected later this year on regulations to implement the second phase of the McCloud remedy (the “deferred choice underpin”), which are due to come into effect for all schemes before a long-stop date of 1 October 2023.

The recent Finance Act 2022 has given HM Treasury powers to address tax consequences arising from the implementation of McCloud.

In addition, the Finance Act and further regulations extend information requirements and reporting deadlines in relation to Scheme Pays (the mechanism by which a pension scheme member who incurs an annual allowance tax charge can ask their scheme to pay the charge on their behalf and make a corresponding reduction to their scheme benefits). The changes were also created in response to the McCloud remedy, but apply to any members of registered pension schemes using the Scheme Pays function. 

A late addition to the Public Service Pensions and Judicial Offices Act as it progressed through Parliament enables public sector pension scheme regulations to include “guidance or directions on investment decisions which it is not proper for the scheme manager to make in light of UK foreign and defence policy”. This may put to bed the hotly-debated questions raised by the Palestine Solidarity Campaign case.

We await the guidance and consultation on any changes with interest.

In response to Covid-19, legislation was created to allow NHS staff to return to (or increase their) work without negative effect on their pensions. Regulations have been made to extend the easement until 31 October 2022, with further extension to be kept under review.

• The Pensions Regulator’s Single Code remains awaited – consider how you can get ahead and start taking action now.

• Pensions Dashboards: be prepared. The Pensions Dashboards Regulations 2022 came into force in December and confirm a staging date of 30 September 2024 for all public service pension schemes. TPR is currently consulting on a draft compliance and enforcement policy setting out "expectations for trustees and scheme managers” and aims to publish the final policy in spring 2023. Schemes should ensure they are aware of the PDP’s revised standards, and TPR's guidance. A ‘connection guide’ for the LGPS is expected early in 2023.