What's coming up in pensions

• The Spring Budget on 6 March continued to encourage the use of pension funds to boost UK equity investment (in line with the government's Mansion House proposals). Revised annual reporting guidance now requires LGPS funds to provide a summary of asset allocation, including in UK equities (as well as provide greater clarity on progress of pooling), and applies to 2023/24 annual reports (due for publication by 1 December 2024) and onwards. The government pledged to review whether further action should be taken if this data does not demonstrate that UK equity allocations are increasing.

• Schemes may wish to consider The Taskforce on Social Factors’ finalised guide on considering social factors in pension scheme investment; this aims to support trustees with activities to begin to identify and monitor social risks and opportunities of their scheme’s investments.

• Further amending regulations are expected imminently, aimed at fixing some of the issues that have come to light following the Finance Act 2024 changes to of the Lifetime Allowance (LTA). HMRC guidance notes and newsletters continue to be issued (at the time of going to press, newsletter 162 was the latest), and the Pensions Tax Manual is being updated. Public sector schemes should continue to work with their advisors and administrators to understand and implement the changes – and stay aware of continued developments in this area.

• An updated version of the LGPS administrator guide to Abolition of the LTA was published in late June.

In our April briefing we set out how the Public Service Pensions and Judicial Offices Act would start to remedy McCloud unlawful age discrimination.

The DLUHC has recently confirmed that its response to the consultation (on amendments to the statutory underpin for the LGPS alongside draft regulations) has been delayed, now being expected in early 2023 rather than this Autumn. Further consultations on additional aspects (such as compensation and rates of interest), and on new statutory guidance on McCloud implementation, will also take place next year.

In the meantime, the Pensions Ombudsman has published a factsheet on its approach to McCloud and Sargeant complaints. See our Ombudsman Update for this and other publications.

• NHS Pension Changes: regulations came into force on 31 May 2023 making changes to the NHS Pension Scheme Regulations 2015 in relation to uplifts to member contributions in 2023-24 (in line with the ‘Agenda for Change’ pay award.)

• Armed Forces and Firefighters' Pension Schemes: HMT has released a statement highlighting a discrepancy in Treasury Revaluation Orders figures. The Government intends to correct this discrepancy via regulations to be consulted on ‘as quickly as is feasible’.

• Welsh Firefighters: a new consultation sets out proposed amendments to firefighters' pension schemes in Wales that seek to extend access to pensions for ‘Retained’ firefighters, and to ensure that compensation schemes fairly cover work under secondary contracts and are calculated based on full service. The consultation closes on 6 October.

• War widows: The Ministry of Defence has updated its guidance on War Widows'/Widowers' Pensions to state that a one-off lump sum payment is available for eligible spouses who forfeited their pensions prior to 2015.

• The FC Guide will also make it clear that firms should consider whether their systems and controls are proportionate and consistent with their obligations under the Consumer Duty.