The knotty question of whether a pension scheme has been properly equalised or not is an issue that the industry has been grappling with for over 20 years – and it’s still causing headaches. The story will be familiar to most of us: “The trustees thought we’d equalised retirement ages, the company thought we had, members were told we were equalising to age 65, the scheme’s been administered on that basis for years and no members have ever suggested otherwise – so why are the lawyers now saying we haven’t equalised properly?”.
One of the first stories to hit the pensions press this year has been the debate about switchable annuities. Insurers have reacted strongly against Steve Webb’s plans for pensioners to be able to change their provider to access a better deal elsewhere. His thinking is that members may not always be getting the best deal at retirement. Whilst there may be no agreement on the proposal, there is a general consensus that members could be better engaged and supported in the lead up to retirement – the decumulation process. As is well known, trustees have a duty to administer a scheme in members’ interests. So they must make sure that they regularly review their processes for supporting members in securing a retirement income. This is now backed by the Regulator’s Code of Practice which all DC schemes have to comply with (DC arrangements in trust-based pension schemes: the new regulatory framework). Read the rest of this entry »
Are pension scheme trustees stuck between a rock and a hard place? It would seem so, as following the Pensions Regulator’s warnings trustees must decide whether to comply with their duty to facilitate a valid transfer request or delay suspicious requests risking regulatory action. But how easy is it for trustees to be sure pension liberation fraud is taking place? Not very is the answer we have received from trustees and administrators who have reported numerous difficulties in investigating receiving schemes. That means that trustees rarely feel they have sufficient evidence to delay a request, especially when faced with the risk of regulatory action.
You might think that no one wants to go to court. Isn’t it stressful, time consuming and expensive? It can also have a negative impact on the parties’ relationship with each other, unless it is properly handled. However sometimes going to court makes a good deal of sense, particularly in the world of pension schemes.