FORTHCOMING DEVELOPMENT: On 22 November 2023 the DWP published its response to the call for evidence on ‘Options for defined benefit (DB) pension schemes’. The purpose of the call for evidence was to investigate how DB schemes could increase investment and build surpluses without affecting the security of the benefit available or undermining fiduciary duties of trustees. The call for evidence also examined the potential for a consolidator for public sector DB schemes.
The response concluded that there was a lack of consensus in the exact method to be used in pursuing the stated aims of the call for evidence. It was also clear from the responses that there remains a lack of trust from the industry around the extraction of surpluses from schemes and consolidation of pension schemes in the public sector, although there was some support for consolidation of smaller schemes in the public sector.
The DWP has therefore decided to consult in winter 2023/24 on plans to introduce measures to make surplus extraction easier and to establish a public sector consolidator (via the Pension Protection Fund) by 2026.
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