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:
- EU workers to enjoy fully portable pension rights when moving abroad
- New members appointed to TPR’s Determinations Panel
- TPR publishes Budget update for DC schemes
- PPFO Determination – The Ibstock Pension Scheme
EU workers to enjoy fully portable pension rights when moving abroad
On 15 April 2014, the European Parliament passed a draft Directive which will enable EU workers who move to a different EU country to take their full pension rights with them.
The Directive aims to improve the protection of mobile workers’ supplementary pension rights (i.e. rights under occupational pension schemes) in three ways:
- Acquisition: pension rights should be vested (guaranteed) after three years of employment at the latest. When a minimum age for vesting is stipulated, it must not be higher than 21 years.
- Preservation: the rights of workers who leave an employer-run pension scheme before retirement (deferred members) must be preserved and treated fairly compared to the rights of those workers who remain in the scheme, for example as regards indexation.
- Information: workers have the right to know how potential mobility would affect their pension rights, and those who have left the scheme (deferred beneficiaries) must be informed about the value of their rights.
The Directive still needs to be formally approved by the Council of Ministers and the text has yet to be published. Once adopted, EU Member States will have two years to implement the measures set out in the Directive.
New members appointed to TPR’s Determinations Panel
On 15 April 2014, the chair of TPR’s Determinations Panel, Andrew Long, announced the appointment of two new members to the panel. The new members, Tony Foster and David Latham, take up their posts this month.
The Determinations Panel is responsible for making formal decisions relating to cases where TPR seeks to use certain powers. These decisions are called ‘determinations’ and the panel has the power to make a determination where:
- TPR seeks to sanction or prosecute a breach of pensions law;
- a problem has arisen in a scheme that TPR considers can be put right with the use of one of its powers; or
- an application has been made by trustees, managers, members or employers of a scheme for TPR to use one of its powers.
TPR publishes Budget update for DC schemes
TPR has produced a statement to help trustees and their advisers understand the impact of the 2014 Budget on their scheme. It outlines some of the proposed changes, including the removal of tax restrictions on the way that members draw their DC benefits at their normal retirement date.
For details of the Budget proposals / measures, please see our Alerts: “Budget 2014: Never a quiet year for pensions” and “Budget changes for pensions: What’s happening on 27 March 2014?”.
PPFO Determination – The Ibstock Pension Scheme
The PPF Ombudsman (PPFO) has concluded that, while the position taken was “robust”, the decision of the PPF’s Reconsideration Committee not to exercise its discretion to allow the correction of data submitted to the PPF in respect of the risk-based levy was reached correctly.
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