Pensions - Articles - Incentive exercises: update to the industry


 The Pensions Regulator has reviewed its guidance on incentive exercises and replaced it with a short principles-based statement on incentive exercises following publication last month of an industry code on this area.

 The practical guidance in the industry code as to how employers should properly conduct incentive exercises, if they choose to do so, is well aligned with the regulator's principles.

 Therefore the regulator has abbreviated its guidance to avoid any confusion arising from two standards - focusing on the overarching principles published in its December 2010 guidance.

 The regulator’s guidance also addresses the role of trustees, which is not covered in detail in the industry code. It remains the regulator’s view that trustees should approach such exercises with caution and presume that they will not be in most members’ interests. This will involve taking advice, where necessary, and acting in accordance with their legal obligations to scheme members.

 The regulator’s chief executive Bill Galvin said:

 "The regulator welcomes the industry’s bid to drive up standards. This is important because any transfer out of a defined benefit scheme poses a significant risk to members who may not be equipped to make an informed decision, and such offers won't be in most members’ best interests.

 "For those employers that decide to undertake such an exercise, the industry code sets out the good practice principles that should be applied. If conflicts are appropriately managed, trustees are engaged throughout the exercises, and the principles in the industry code are followed, then exercises should fulfil and be consistent with our principles.”

Back to Index


Similar News to this Story

FCA on connecting consumers products and growth
At a time when increasing pensions contributions substantially is out of the question or insufficient for many, we must focus instead on how to improv
AI is changing pensions admin but still has a long way to go
Trafalgar House has announced the first results of their 2025 Trust & Confidence Index showing that whilst AI is beginning to play an important role i
4 key findings about the state pension ahead of the increase
Ahead of the 4.1% increase to the state pension (from 6th April), Phoenix Insights shares its four key findings about the state pension.

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.