The government has called for evidence on the Pension Schemes Bill before the legislation is further scrutinised, following yesterday’s second reading of the Bill in the House of Commons.
The Bill will establish a new legislative framework for private pensions, defining them on the basis of the promise they offer for members about their retirement benefits during the ‘accumulation’ - or ‘saving’ - phase.
This ‘promise’ will either refer to all the benefits (defined benefits), some of the benefits (shared risk), or there will be no promise at all (defined contributions).
It will also enable the provision of collective benefits, provided on the basis of allowing the scheme’s assets to be used in a way that pools risks across membership.
The Bill will also give force to measures announced in Budget 2014, giving people aged 55 and over more flexibility about how to access their DC pension savings from April 2015. I
In addition, it will enable a prohibition on transfers out of unfunded public service pension schemes, except to other DB schemes.
Measures to introduce a ‘guidance guarantee’ are not in the current Bill but are to be the subject of government amendments in the autumn.
The legislation has been sent to the Public Bill Committee for scrutiny and a committee will be selected on 14 October.
The committee is expected to meet for the first time on 16 October and will stop receiving written evidence at the end of the committee stage on 6 November.