The Pensions Minister today unveiled a set of measures to ease the administrative and regulatory burden on employers.
The Department for Work and Pensions (DWP) examined the regulations covering private pensions, following input from pension providers, businesses and consumers, as part of the Government's Red Tape Challenge.
Although it found the legislation to be largely fit for purpose, a number of stakeholders highlighted key areas in need of improvement. These included disclosure of information rules which have built up over the past 25 years governing what, when and how pension schemes communicate with their members.
The DWP estimates businesses will save £10 million a year as a result of changes it is making to these regulations.
Pensions Minister Steve Webb said:
"We took a forensic look at regulations covering private pensions as part of our work on the Red Tape Challenge, and the good news is we found they are mostly working well. But far from resting on our laurels, we are finding new ways to cut red tape and ease the burden of regulations on employers.
Our changes will save businesses millions of pounds, by streamlining and improving rules governing what, when and how pension schemes must communicate with their members.
We are also giving the Pensions Regulator a new objective to ensure a company's need for sustainable growth is part of its pension scheme funding negotiations."
Key outcomes of the DWP's Red Tape Challenge work include:
♦ Simplifying disclosure of information rules, to harmonise requirements across different schemes and extending the use of electronic communication, such as email or websites
♦ A new statutory objective for the Pensions Regulator better balancing the need to protect members' benefits with the need for sponsoring employers to be able to grow in a sustainable way.
♦ More work to see how the current processes relating to employer debt that cause difficulties for charities and others participating in multi-employer schemes could be improved.
♦ Considering whether to make indexation for future accruals discretionary as part of on-going work to encourage risk sharing through new ‘Defined Ambition' pensions.
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