Pension news
PASA’s first annual event THE FIRST annual event of the Pensions Administration Standards Association (PASA), hosted in London late February, was attended by more than seventy industry professionals. Fergus Clarke, PASA’s executive director, said “PASA is making good progress in driving up administration standards, but there is much more work to be done. Our goal has always been openly and simply stated – the right member to be delivered the right benefit, at the right time. That being said, this responsibility does not fall to administrators alone. We are all accountable, but there is a worrying lack of engagement from many. Coming together is the only way we can make a difference to what’s going on in our industry.” Andrew Warwick-Thompson, executive director of The Pensions Regulator said: “Industry groups like PASA are hugely helpful to us in driving good practice from within the administration industry itself, complementing our efforts to raise standards.” As well as raising the profile of pension administration generally, PASA (http://www.pasa-uk.com/) focuses on three core activities: ● defining good standards of pensions administration relevant to all providers, whether in-house, third party or insurers ● publishing guidance to support those standards ● being an independent accreditation body, assessing the achievement of good standards by schemes (regardless of provider). Retirement confusion RECENT RESEARCH from employee benefits consultancy Portus Consulting (www.portusconsulting.co.uk) shows that: ● 17% of retirement savers – rising to 27% of those aged 45–54 – have built up three or more company pension funds as they have moved jobs during their working career ● around 39% of employees believe they can roughly estimate the value of their total retirement fund; half admit they do not know how much they have invested, and just 11% accurately estimate the value of their retirement savings ● 7% of employees admit to having no pension funds at all, rising to 19% among those aged 18–24 but falling to 10% among those aged 55–64 ● men are more likely to have multiple pension schemes than women: 20% of male employees have three or more schemes compared with 13% of women. Steve Watson, Portus Consulting commercial director, commented: “Keeping track of retirement savings and investments is a challenge for most people but particularly difficult for employees with multiple funds.”
Survivor pensions IN FEBRUARY 2017, the Supreme Court unanimously allowed the appeal by Ms Brewster, declaring that the requirement in the Local Government Pension Scheme (Benefits, Membership and Contributions) Regulations 2009 (‘the Regulations’) that Mr McMullan – her co-habiting unmarried partner – should have made a nomination enabling her to receive a survivor’s pension under the rules of the Local Government Pension Scheme (LGPS), be disapplied. The Regulations provide that unmarried co-habiting partners be nominated by their pension scheme member partner in order to be eligible for a survivor’s pension and that the survivor must also show that he or she has been a cohabitant for two years before the date on which the LGPS member sent the nomination and has been in that position for two years before the date of death. There is no similar nomination requirement for married or civil partner survivors. Ms Brewster had lived with Mr McMullan for around ten years. On 24 December 2009 they became engaged, but Mr McMullan died two days later. Ms Brewster believed that Mr McMullan had completed a form in which he nominated her to be eligible for a survivor’s pension from the LGPS, but the Northern Ireland Local Government Officers’ Superannuation Committee (NILGOSC), which administers the scheme, says it did not receive any form. Accordingly, NILGOSC refused to pay her a survivor’s pension. Ms Brewster applied for a judicial review of that decision. Dave Prentis, UNISON general secretary, said: “[The] judgement is good news for anyone like Denise Brewster who stood to lose out on their partner’s pension, simply because a form hadn’t been signed. It means the Northern Ireland [LGPS] and others covering people working in education, the NHS and the civil service will now have to look again at their rules.” Daniel Taylor, director at Trafalgar House, the pensions administration specialists, commented: “Trustees of private sector pension schemes who think they can dismiss the outcome of the Brewster decision due to its limited application to government-backed schemes should think again. “This is a difficult situation for schemes and what’s worse is that there is the potential for members to stop filling in expression of wish forms nominating their unmarried partner because they now think the law affords automatic protection – a mistake that could have serious implications for families in later life.” Another legal case due to be heard will determine whether partners denied pensions in the past because a nomination form was not completed will also be able to claim. DB scheme consultation THE DEPARTMENT for Work and Pensions (DWP) has published a Green Paper – Security and Sustainability in Defined Benefit Pension Schemes (http://bit.ly/2lO741y) – setting out evidence available about the key challenges facing defined benefit (DB) pension schemes and highlighting a number of options that have been suggested to improve confidence in the system. In order to ensure a balance between member protection, sustainability and affordability of these important pensions the DWP wants to continue the debate and to start building a consensus on what, if anything, should be done to further support the sector. Views from as wide a range of people and organisations with an interest in private sector DB pension schemes as possible, are sought. The consultation run until 14 May 2017.
| Professional in Payroll, Pensions and Reward | April 2017 | Issue 29 40
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