CIPP Payroll: need to know 2018-2019

This paper follows on from the consultation ‘Defined benefit pension schemes: security and sustainability’ and ‘sets out government plans to: • protect private pensions through a stronger Pensions Regulator • clarify scheme funding principles • create the right conditions for, and promote the benefits of, consolidation There have been significant changes in the structure of the overall pension landscape recently, with the introduction of automatic enrolment and the growth of Defined Contribution schemes. This has meant that the Defined Benefit (DB) pension sector has changed over recent years. The majority of DB schemes are now closed to new members; however, with around £1.5 trillion assets held under management by DB schemes and around 10.5 million scheme members relying on DB pensions for a substantial portion of their expected retirement income, they remain of critical importance.

Furthermore, DB pension schemes are also an important part of the UK economy as they can provide the investment needed to fund new businesses and finance public debt.

Despite a few recent high-profile cases, the DWP’s findings, and most consultation responses, suggest that there is no systemic problem in the regulatory and legislative framework that governs them. However, there are examples of sponsoring employers misusing this flexibility and sometimes benefitting at the expense of pension scheme members. The Government is determined to ensure we have a corporate governance framework that works for both employers and employees and wants to reduce further the risk of major company failures occurring through shortcomings of governance or stewardship.

Access the DWP’s paper Protecting Defined Benefit Pension Schemes.

Back to Contents

Savings and the self-employed 28 March 2018

An innovation event being held by the Association of British Insurers (ABI), Department for Work and Pensions and HM Treasury, is exploring ways that technology could make it easier for the self-employed to save for retirement.

Nearly 5 million people across Britain now work for themselves, a number that has increased by 50% since 2000, but only 19% of the self-employed are saving into a personal pension. There is no equivalent of auto-enrolment for the self-employed. Teams will be set the challenge of developing practical solutions and interventions, focusing on the role technology and developments such as the Pensions Dashboard and Open Banking could play in helping the self-employed to build greater financial resilience for later life.

Yvonne Braun, Director of Policy, Long-term Savings and Protection, ABI, said:

“People of all sorts of ages, skill levels, backgrounds and professions work for themselves – there is no typical self- employed person. The one thing they do all have in common though is the need to prepare for their retirement and ensure they have a way to pay for it.

Auto-enrolment has brought thousands more workers into pension saving and I’m excited to see what this week’s event can come up with to offer similar security to the self-employed.”