David Davison, a director at Spence & Partners, discusses the recent section 75 debt arrangements and the consequences for pension schemes.
Posts Tagged ‘Section 75’
Recent press comment related to the Plumbing Federation Pension Scheme has once again highlighted the problems associated with the current Section 75 pensions legislation, however it is just the tip of a very large iceberg. Read more »
Spence & Partners, the UK pension actuaries and administration specialists, today shared their concerns that more charities will become trapped in multi-employer pension schemes with damaging liabilities unless government amends Section 75 legislation.
In March of this year, the Department for Work and Pensions (DWP) were seeking views on the operation of the employer debt regime for non-associated multi-employer defined benefit schemes in a call for evidence which closed in May. As of yet no proposals have been made and the DWP website warns that it was published under the Coalition government and therefore might not be a priority for the current regime. Read more »
As charities face continuing issues with their defined benefit pension provision I’d viewed the consultation on the Section 75 regulations with some degree of optimism in the hope that there might at last be a recognition that unconnected organisations participating in multi-employer schemes might at last be viewed as a special case. Indeed pensions minister Steve Webb responded to some of my comments in a recent Pensions Week article by referring to the consultation.
Unfortunately the focus of the consultation is very much on connected organisations and centred around the impact of corporate activity and misses the specific issues faced by third sector employers entirely. Schemes are being forced to operate with one hand tied behind their backs and participants offered less flexibility than would be the case if they had their own scheme leading them to make decisions which are undoubtedly against their long terms financial interests.
Our full response to the consultation can be found here and it is to be hoped that the scope of the consultation can be widened and this inconsistency dealt with.