Secretary of state for work and pensions Andrew Smith has today announced the government's plans to ...
Secretary of state for work and pensions Andrew Smith has today announced the government's plans to implement an insurance scheme to protect the benefits of pension scheme members in cases where employers go bust, leaving beneficiaries with much reduced or even no retirement income.
The change is included in the DWP's document "Simplicity, security and choice: Working and saving for retirement", in which the department identifies a series of changes it wants to implement.
Among these are:
TUPE regulations will be changed, extending protection to workers in firms bought out and the pension schemes of those in the private sector.
Vesting rights get a boost. The two-year rule will be replaced by one enabling any employee who has been a member of a scheme for at least three months and who leaves during the vesting period the right to be offered a refund of contributions or a Cash Equivalent Transfer Value.
A new Pensions Regulator " will concentrate on rooting out fraud and bad practice"
The MFR will be replaced with "scheme-specific funding arrangement".
The cap on mandatory indexation, required of schemes, will be reduced.
Increased flexibility for schemes will "rationalise the structure of their benefits".
And the DWP will work to "simplify the legislation in other key areas – including tax and contracting out – to make it easier to administer pension schemes."
Other changes announced are:
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