Aries monitors every development in new and proposed legislation and official guidance.   Clients are kept up to date via the website, email alerts and tweets.   Aries serves as a one-stop source of intelligence on everything that is going on and coming up.   Aries doesn't miss anything of significance.

Here is a selection from our most recent headlines. You can get the fuller details by sending us an email - just click here to fire one off.

The Pensions Regulator (TPR) has been quizzed by the Work and Pensions Committee about the organisation's response to the COVID-19 outbreak. As the published transcript shows, there were several breaks in transmission of the physically-distanced responses, but here are the central themes emanating from the discussion:

Q. Explain exactly what is meant by "a proportionate and risk-based approach towards enforcement decisions...with

the aim of supporting both employers and savers".

A. The commitment throughout has been to protect pension savers, and to be clear and quick in issuing guidance to trustees. Focus was also on automatic enrolment (AE) and employer duties. Scheme providers have received various easements including an extended period for reporting contribution failures.

Q. Is there much falling away of automatic

enrolment contributions?

A. Not much evidence at the time of this discussion (19 May 2020). With the DWP, TPR are carrying out a survey of providers to keep track of opt-outs and contributions.

Q. How frequently has TPR been approached by struggling employers?

A. TPR has received very few approaches . . .

29 May 2020  

HMRC's 120th Pensions Schemes Newsletter (PSN) continues the trend from PSN 118 and PSN 119 and announces further temporary changes as a result of COVID-19.

Relief at source and suspension of the process for applying for a National Insurance number

From the end of March 2020, HMRC suspended, for three months, the process for applying for a National Insurance number. This will be reviewed and an

update provided in the next PSN.

This PSN asks that HMRC be contacted if a relief at source repayment claim has been submitted, or needs to be, and the claim includes tax relief given to a scheme member, and that member is unable to get a National Insurance number because of the suspension.

Submitting the APSS107 Registered pension schemes annual statistical return without a signature

HMRC acknowledges that COVID-19 may make it difficult for scheme administrators to obtain signatures on the APSS107 'Registered pension schemes annual statistical return'. "For now", HMRC will accept APSS107 returns without a signature.

The PSN then returns to normal, non-COVID-19, service:

Contacting HMRC's Pension Schemes . . .

28 May 2020  

The DWP has published analysis, derived from DWP and ONS survey data for the financial year 2016 to 2017, relating to the Pension Protection Fund (PPF) compensation cap and labour market experience of older workers.

This analysis provides context around the level of the PPF compensation cap in relation to income and earnings, as well as context on durations of employment and age of retirement. In 2016 to 2017:

  • 62% of pensioner 'benefit units'* had some income from an occupational pension, and of these, 9% were getting the equivalent of around £33,684 (90% of the annual PPF Compensation Cap at age 65) or more pa.
  • * this term includes single pensioners (individuals over State Pension age), pensioner couples (married or cohabiting pensioners where one or more are over State Pension age) and income related to any dependent children.

  • 26.5% of employees in a defined benefit (DB) pension scheme (private and public sectors) aged 60+ had an annual gross pay above £33,678.38. That figure is 18.8% if all employees are considered, not just those in a DB scheme.
  • The salary required to accrue pension at the £33,678.38 level was £50,517.57 (at a 40/60ths accrual rate). 10.4% of employees aged 16+ with DB provision had annual gross pay above this level. . . .

    27 May 2020  

    After recent bleak news for the SIPP industry, and not forgetting the Berkeley Burke case, the judgment handed down this week in the high-profile Adams v Carey case should ease the pain somewhat. Hundreds of outstanding complaints and cases against SIPP providers have been hanging on this case.

    Now known as Russell Adams v Options SIPP (or more fully Russell David Edward Adams v Options Sipp UK LLP and The Financial Conduct Authority [2020]

    EWHC 1229), the case sought to establish potential liability of an execution-only SIPP provider (Options SIPP UK LLP, formerly Carey Pensions UK LLP) to an investor whose investment in the SIPP - made with funds transferred from an insured personal pension and on the recommendation of an unregulated introducer - suffered significant losses.

    The basis for the case was a claimed breach of the regulatory regime in establishing the SIPP early in 2012, as a

    result of the acts of the introducer, rendering the SIPP "unenforceable" under section 27 of the Financial Services and Markets Act 2000. Secondly, there was a claimed breach of the Financial Conduct Authority's Conduct of Business Sourcebook (COBS) which requires the provider to act "honestly, fairly and professionally in accordance with the best interests of its client" (COBS 2.1.1). Thirdly, there was the claim . . .

    22 May 2020  

    The Pensions Regulator (TPR) has updated its guidance for trustees on defined contribution (DC) scheme management and investment.

    The new section is titled 'When does the temporary closure of funds create a default arrangement?'. It considers the possible situation where some trustees have redirected, to alternative funds, some members' self-selected investment in funds that have temporarily closed (or been 'gated') until the market 'normalises'.

    TPR warns this could result in the alternative funds becoming default arrangements and therefore becoming subject to legal requirements such as the charge cap (if the scheme is used for automatic enrolment) and the requirement to have a statement of investment principles for that default arrangement. TPR suggests legal advice may be required to assess whether this is the case. The position will depend on how the members made the choice to select the investment: were they aware and did

    they agree to their contributions being used in this way?

    TPR suggests that the only circumstances where a default arrangement would not be created are if either:

    • members were made aware before they selected the original fund that contributions could be diverted to another fund in certain situations; or
    • . . .

    21 May 2020