Members of defined benefit (DB) pension schemes are being reminded they have until Friday (19) to respond to draft guidance on how to calculate transfer values.
The guidance, put together by The Pensions Regulator (TPR), aims to help DB trustees understand and fulfill new responsibilities being introduced in regulations by the Department for Work and Pensions (DWP).
From 1 October it will be the responsibility of the trustees to take the decisions on which the calculation of cash equivalent transfer values is based.
This value refers to the expected cost to the scheme of providing the member's accrued benefits.
It requires assumptions to be made about the future course of events affecting the scheme and the member's benefits, such as investment returns, mortality and inflation rates.
The regulator's draft guidance provides suggestions of good practice in the calculation of CETVs.
However, TPR has been criticised for its publication of draft guidance, with some providers arguing it has come too late for trustees to benefit.
The TPR’s consultation document can be accessed here.
Responses may be sent to the regulator by email, at [email protected] or via post: Erhan Kalyon, The Pensions Regulator, Napier House, Trafalgar Place, Brighton, BN1 4DW
020 7484 9791
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