Developments in Employee Benefits law and practice

06 August 2018

Latest pension freedoms statistics

Latest pension freedoms statistics

A record £2.3bn was withdrawn from pensions under freedom and choice in Q2 of 2018.

https://www.gov.uk/government/statistics/flexible-payments-from-pensions

Pensions Newsletter 101

Contents from HMRC’s pensions newsletter are -

  1. Master Trusts
  2. Registering a pension scheme - time limits
  3. Taxation of flexi access payments
  4. Annual allowance
  5. Relief at source
  6. Pension flexibility
  7. Qualifying recognised overseas pension schemes (QROPS) transfer statistics
  8. Manage and Register Pension Schemes service - completing enrolment information

https://www.gov.uk/government/publications/pension-schemes-newsletter-101-july-2018/pension-schemes-newsletter-101-july-2018#pension-flexibility

New pension scams campaign

The Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) will soon be launching a new campaign to raise awareness about pension scams.

The aim of the campaign is to provide consumers with the knowledge and tools to avoid pension scams. It is a joint campaign from the FCA and TPR, designed to deliver a consistent message both to consumers and members of pension schemes, and the intermediaries who they may turn to for information about their pension, including advisers, their pension provider, and their employer.

The campaign will highlight the risk of being scammed out of your pension, and how to spot the warning signs. It will use a new creative concept, replacing TPR’s existing ‘Scorpion’ activity, and will form part of FCA’s broader ‘ScamSmart’ initiative.

It will target those most at risk of pension scams, pension holders aged 45-65, and the call to action is Don’t let a scammer enjoy your retirement. Be ScamSmart. Check who you’re dealing with at fca.org.uk/scamsmart. Consumers will be directed to the FCA ScamSmart website.

The campaign will launch on Tuesday 14 August across TV, radio, online video, digital display and social media. Advertising will run on TV, radio and online video for three weeks from 14 August, and across the additional channels until the end of October. The campaign will continue beyond October and into next year through press and social media channels, and we expect to run further bursts of advertising in the next financial year.

ONS stats reveal lack of auto-enrolment awareness

According to Office for National Statistics research, around 36% of workers do not know that they have been automatically enrolled into a workplace pension.

The Wealth and assets study - attitudes towards saving for retirement – found that 63% of eligible employees were aware they have been auto-enrolled and 1% were unsure.

https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/articles/earlyindicatorestimatesfromthewealthandassetssurvey/attitudestowardssavingforretirementautomaticenrolmentintoworkplacepensionscreditcommitmentsanddebtburdenjuly2016todecember2017.

Inclusions on QROPS list does not mean a scheme is a QROPS or approved

A First-tier Tribunal decision in Gordon and Ors has confirmed that, just because a pension scheme (in this case a Latvian scheme) was on HMRC’s Qualifying Recognised Overseas Pension Scheme (QROPS) list did not mean it was either a QROPS or approved.

The scheme submitted forms to HMRC in July 2008 to notify that it was a recognised overseas pension scheme and was accepted as a QROPS in August 2008. However, it was then removed from the QROPS list in September 2010. HMRC investigated the scheme and found that unauthorised payments.

Appeals by certain individuals against charges were successful. The Tribunal also confirmed that the scheme’s inclusion on HMRC's QROPS list did not mean it was either a QROPS or approved.

http://www.bailii.org/uk/cases/UKFTT/TC/2018/TC06537.pdf

WPC starts transparency inquiry

A new inquiry by the Work and Pension Committee will focus on whether the pensions industry provides sufficient transparency around charges, investment strategy and performance to consumers.

The Inquiry will examine whether enough is being done to ensure individuals:

  • get value for money for their pension savings;
  • understand what they are being charged and why;
  • understand the short- and long-term impact of costs on retirement outcomes;
  • can see how their money is being invested and how their investments are performing;
  • are engaged enough to use information about costs and investments to make informed choices about their pension savings; and
  • get good-value, impartial service from financial advisers.

https://www.parliament.uk/business/committees/committees-a-z/commons-select/work-and-pensions-committee/inquiries/parliament-2017/inquiry11/

Contact:

John W. Wilson LLB(Hons) FPMI ACII, Head of Research| Email: john_wilson@jltgroup.com

Stephen Williams, Senior Research Consultant | Email: stephen_williams@jltgroup.com