Pensions Weekly Update – 4 February 2025

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

• The text of the chancellor’s speech on economic growth, given at Siemens Healthineers in Oxfordshire on 29 January 2025, has now been published. It includes reference to relaxing the restrictions around the extraction of surplus from defined benefit (DB) pension schemes. We understand that the details will be included in the government’s response to consultation on options for DB schemes, which is expected in the spring.
• The Pensions Regulator (TPR) has published a press release in support of the government’s proposals where schemes are fully funded and appropriate protections are in place for members. TPR has also published new data as at 30 September 2024, which provides estimates of DB scheme assets and liabilities, number of schemes in deficit and in surplus, as well as a breakdown of DB surpluses across technical provisions, low dependency and buyout together with the cumulative DB asset value by number of schemes (smallest to largest).
• The Pension Protection Fund (PPF) has published its policy statement and levy rules for 2025-2026. At the consultation stage, the PPF proposed a levy estimate of £100 million, as was the case for the 2024-2025 levy year. While acknowledging that the PPF does not need to raise additional funds in the 2025-2026 levy year, the PPF noted the legislative restrictions that prevent it from raising the levy year-on-year by more than 25%, thereby hindering the amount that could be raised by way of levy in subsequent years if the levy were set too low. The PPF received some push back on the proposed levy amount during the consultation process, which resulted in discussions with the Department for Work and Pensions (DWP) and a delay in the release of the levy rules until 30 January 2025. The PPF has now set the levy estimate at £45 million, and it is expected that 99.7% of schemes will see a reduction in levy, with the average levy as a proportion of liabilities falling from 0.011% to 0.006%. The DWP has published its own press release confirming that it is considering proposals to allow the PPF greater flexibility to reduce the levy it collects from pension schemes by relaxing legislation. The PPF has included a mechanism in the levy rules that would allow it to reduce the levy down to zero in respect of traditional DB schemes, in the event that anticipated legislation is sufficiently well progressed before invoicing commences in the autumn. The alternative covenant scheme risk-based levy would continue to be charged. The PPF says that “the Board expects to take the alternative approach if it can be confident ahead of invoicing that the legislative changes needed will be enacted in the forthcoming pension schemes bill”. It will provide an update on invoicing at the end of September.
• The key date for submission of electronic contingent asset certificates to the PPF continues to be midnight on 31 March 2025, with supporting documents to be provided by 5 p.m. on 1 April 2025. Trustees will need to have a different kind of conversation with their advisers this year when undertaking the cost/benefit analysis of submitting or recertifying contingent assets.
• The Pensions Ombudsman (TPO) has opened registration for an online technical forum for pension professionals being held on 27 February 2025. This will cover TPO’s operating model review, TPO’s new corporate strategy for the next three years, thematic sessions on dealing with overpayment complaints and the McCloud remedy for public sector professionals.
• Join our colleagues in the US for a webinar being held on 5 February at 5 p.m. GMT, which will highlight some of the key issues employers are facing in light of the recent executive orders signed by President Trump. The orders impacting employers include an order ending certain federal contractor affirmative action requirements and terminating federal Diversity, Equity and Inclusion (DEI) policies, immigration orders focusing on birthright citizenship, extreme vetting of foreign nationals, border enforcement and the suspension of US refugee and asylum processing.
• Our colleagues in the UK will be holding a webinar on 12 March 2025, where they will explore the key legal and practical issues to be aware of when handling a workplace investigation, whether it involves a grievance, disciplinary, whistleblowing or other employment matter.

If you would like specific advice on any of these issues or anything else, please contact a member of our Pensions team.