Pension News for Employers - Spring 2013

There were a couple of items in the 20 March 2013 budget which are directly relevant to sponsors of occupational pension schemes:

• The Chancellor announced that the flat rate state pension will be introduced from April 2016 rather than 2017 and hence the abolition of contracting out for final salary schemes has been brought forward
• The government is introducing an additional objective for The Pensions Regulator “to support scheme funding arrangements that are compatible with sustainable growth for the sponsoring employer and fully consistent with the 2004 funding legislation”.  The precise wording of this objective will be set out in legislation in the next few months.  The Regulator’s interpretation of this new objective is yet to be determined but this objective is likely to be a relevant factor when considering the appropriate level of contributions to the Scheme following the next actuarial valuation.  We are also expecting the Regulator to revise its Code of Practice on scheme funding in light of the new objective

Our latest newsletter covers other relevant developments in pensions including:

• Pension Taxation Issues for High Earners
• ONS consultation result: No change to RPI formula
• Auto-enrolment: Are you ready for 2013?
• Current issues in Financial Reporting
• Buy-outs, buy-ins and longevity swaps news