04 February 2025
7 min
Please see excerpts below from this month's Current Issues. Click here to read the full publication.
The Government has confirmed plans to liberalise 'how well-funded, occupational defined benefit pension funds that are performing well will be able to invest their surplus funds.' The press release says that the Government will provide policy details in the spring, as part of its response to the February – April 2024 consultation exercise on Options for Defined Benefit Schemes.
The Pension Protection Fund (PPF) has finalised its policy on the 2025/26 levies. In response to consultation feedback, and positive noises from the Government on the prospects for legislative amendment, it has cut the levy estimate from £100m to £45m. The Levy Policy Statement says that, 'Overall, 99.7 per cent of schemes will see a reduction in total levy—with an average decrease of around 55 per cent—and the average levy as a proportion of liabilities falling from 0.011 per cent to 0.006 per cent.'
The Department for Work and Pensions (DWP) has reviewed the auto-enrolment earnings trigger and qualifying earnings band for 2025/26 and has chosen to retain the current levels. The earnings trigger for 2025/26 will be £10,000 and the qualifying earnings band will be £6,240 to £50,270.
Torsten Bell has replaced Emma Reynolds in the historically unusual dual role that she held as Pensions Minister and Parliamentary Secretary at His Majesty’s Treasury. Reynolds has been promoted to Economic Secretary to the Treasury. The mini-reshuffle/game of ministerial musical chairs was prompted by the resignation of former Economic Secretary Tulip Siddiq.
The Scheme Advisory Board for the Local Government Pension Scheme (LGPS) in England and Wales has published an update to Counsel's opinion on the investment duties of administering authorities (AAs). It focuses especially on the factors that AAs can (or in some cases should) take into account when making decisions.
The Pensions Dashboards Programme (PDP) has released updated draft reporting standards for pension providers and schemes. The standards outline the requirements for generating, recording and reporting operational information to the Money and Pensions Service (MaPS).
As part of a project reviewing financial remedy orders on divorce, the Law Commission in England and Wales has identified potential reforms to the way in which pensions are treated, and to the use of sharing orders. If taken up by the Government, there could be implications for pensions administration.
His Majesty’s Treasury has reported on the outcome of its review of the 'temporary' (spoiler alert: ironic use of quotation marks) exemption of pension funds from the obligation to clear certain derivative contracts through central counterparties. It has concluded that the exemption, which was due to expire on 18 June 2025, should be maintained, and will bring forward legislation to that end.
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