Spence & Partners Catrina Browne explains what schemes need to know and do about the end of contracting out in 2016. In an article published in Pensions World magazine she urges companies to seek good, comprehensive advice on how the changes impact the scheme, put a plan of action in place as soon as possible and to make sure the members understand what is going on. Download your copy of the Pensions World article here
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Spence & Partners latest blog for Pension Funds Online –
Contracting Out on a final salary basis will end on 5th April 2016, it will have partnered pension schemes for 38 years. Its loss will be felt no doubt, but, as with any break-up, it’s preferable to leave on amicable terms.
It may seem a little odd to think of this as a break-up but April 2016 is the point at which two entities, once very much intertwined, go their separate ways so it seems like an appropriate narrative.
HMRC will leave to focus on the new Single-Tier State Pension and the scheme will be left with their GMPs and more money to find. This is the time to understand exactly what the break-up means, what decisions need to be made and how to break the news to the members.
National Insurance contributions are being increased from 6th April 2016, the new Single-Tier State Pension is being introduced and HMRC letters will be issued in December 2018. Read more »