7 days

7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.

In this 7 Days

• Pensions dashboards developments: draft regulations laid before Parliament and PDP publishes blog on next phase of its programme
• WPC opens call for evidence on DB schemes with LDI strategies
• DWP updates statutory guidance on reporting costs, charges and other information
• Mr H (CAS-33253-W9R0): Complaint regarding discretionary bonuses (28 September 2022)

Pensions dashboards developments: draft regulations laid before Parliament and PDP publishes blog on next phase of its programme

On 17 October 2022, the draft Pensions Dashboards Regulations were laid before Parliament. The regulations set out, among other things, trustees’ obligations in respect of pensions dashboards. As expected, schemes will have to connect to the dashboard ecosystem in stages, with the first two cohorts (large DC master trusts and large DC schemes used for automatic enrolment) to connect by 31 August and 30 September 2023 respectively. However, regardless of their staging deadline, the DWP and TPR expect all trustees to be preparing for dashboards. See our Alert for more detail.

On the same date, the PDP published a blog detailing its move “over the coming months” to the next phase of its programme, which will lead to the connection of early participants (pension providers, schemes and integrated service providers who have volunteered to help test and develop the service) to the dashboards ecosystem.

WPC opens call for evidence on DB schemes with LDI strategies

On 24 October 2022, the WPC launched a new inquiry into DB schemes with LDI, following the rapid increases in gilt yields in late September and early October and the Bank of England’s temporary gilt purchase programme (see 7 Days). The WPC has opened a call for evidence as part of the inquiry, looking at issues including the impact of the rise in gilt yields on DB schemes, the impact on members in both DB and DC arrangements and whether the experience suggests other policy or governance changes are needed.

The call for evidence closes on 15 November 2022. The WPC intends to follow this with a further inquiry in 2023 looking at DB schemes more widely, with issues “likely to include DB scheme funding requirements and arrangements to protect pension benefits when a scheme is wound up”.

DWP updates statutory guidance on reporting costs, charges and other information

On 21 October 2022, the DWP published an updated version of its statutory guidance on disclosure of costs, charges and other information relating to DC benefits. The statutory guidance sets out the matters to which trustees should have regard when producing an illustration and when publishing certain information, including the scheme’s SIP. The update takes into account the introduction of new CDC schemes and is effective from 21 October 2022.

Mr H (CAS-33253-W9R0): Complaint regarding discretionary bonuses (28 September 2022)

TPO has dismissed a complaint from a member, Mr H, that no discretionary bonuses had been awarded to his section of the scheme since 2015. Under the terms of Mr H’s section, any bonuses declared by the trustee were applied to pay increases to pensions. The case confirms that, when exercising a discretion to pay increases, trustees and employers need to carefully consider the relevant governing rules and should take into account relevant factors, including the scheme’s funding position. In this case, relevant factors included the impact an award of discretionary increases would have on the employer’s financial viability and the ongoing solvency of the relevant section of the scheme. See our case summary for more detail.