Pensions Weekly Update – 17 November 2021

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Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes, which you might have missed, with links for further information.

The Pensions Administration Standards Association (PASA) Guaranteed Minimum Pension (GMP) Working Group has published a briefing note on GMP Reconciliation and Transitions. The briefing note is designed to supplement previous guidance on the GMP reconciliation process. It considers the best practice process that should be applied when transferring data involving members' GMP amounts to a new administrator, and the need to hand over “off system” workbooks that document the GMP reconciliation process that has already been carried out.
The PASA Data Working Group has published guidance on Ongoing Data Management & Controls. The guidance notes the importance of having robust criteria for accepting new data, which will ensure the overall integrity of a database. “Data management of pension scheme records is an ongoing process which should be considered an activity in its own right. The accuracy of pension scheme records is fundamental and the foundation for the majority of activities a scheme needs to undertake throughout its lifetime.”
In last week's update, we noted that the government had announced its intention to suspend the earnings link element of the state pension triple lock for one year, but that the House of Lords had voted an amendment to the Social Security (Up-rating of Benefits) Bill that, if passed, would have reinstated the earnings link. The House of Commons has now considered and rejected the amendments proposed by the House of Lords, which means that the suspension of the earnings link for one year will proceed as planned.
The High Court has handed down its judgment relating to the Mitchells and Butlers Pension Plan concerning an application from the trustees for rectification of the pension increase rules. In this case, rectification was granted. Rectification is a useful tool where the intentions of the parties are not properly reflected in the drafting of the documentation, but each case will turn on its own facts and rectification is by no means a certain outcome, regardless of what the parties think to be the position. More information on rectification as a possible remedy can be found in our #How2DoPensions quick guide.
New UK regulations coming into force on 30 November 2021 change the conditions applying to a pension scheme member's statutory right to take a cash equivalent transfer value. The changes have been introduced to help protect pension scheme members from scams and will impact occupational and personal pension schemes in the public and private sectors. Trustees and managers of pension schemes will have to act quickly to incorporate the new requirements into their existing processes. Read more in our publication.