GLOSSARY

Pensions Regulator definition

Published by a LexisNexis Pensions expert

What does Pensions Regulator mean?

The Pensions Regulator was established under the Pensions Act 2004 to replace the dysfunctional OPRA in April 2005. Its main purposes are to: protect the benefits of members of company pension arrangements (whether trust or contract based); keep claims on the Pension Protection Fund to a minimum; and facilitate good pension administration.

To achieve these purposes, it has extensive powers, including: provider of information, education and assistance to pension schemes and their advisers; power to serve:

– improvement notice;

– third party notice;

– freezing order;

– prohibition order;

– contribution notice;

– financial support direction; and

– restoration order.

Longer term is role will diminish as the number of defined benefit schemes diminishes – but it is trying to find a role for itself in defined contribution schemes.

Minimise

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The regulation of pensions—division of roles between the Pensions Regulator and the FCA

Role of the Pensions RegulatorStatutory objectivesThe core role of the Pensions Regulator is to fulfil the statutory objectives set out in the Pensions Act 2004, s 5 (PeA 2004).These are:•to protect the benefits of, or in respect of, members of occupational pension schemes•to protect the benefits of, or in respect of, members of personal pension schemes who are:◦employees in respect of whom there are 'direct payment arrangements' (defined below), and◦where the scheme is a stakeholder pension scheme, any other members•to reduce the risk of situations arising which may lead to compensation being payable from the Pension Protection Fund•to maximise compliance with auto-enrolment duties (for more information on which, see Practice Note: Auto-enrolment—an introduction•to promote and to improve understanding of the good administration of 'work-based pension schemes', ie:◦an occupational pension scheme◦a personal pension scheme where there are 'direct payment arrangements' (defined below) in respect of one or more members of the scheme who are employees, or◦a stakeholder pension scheme'Direct payment arrangements' is defined under the Pension Schemes Act 1993, s 111A(2) (PSA 1993) as arrangements under which contributions fall to be paid by or on behalf of the employer towards the scheme:•on the employer’s own account (but in respect of the employee), or

The role of the Pensions Regulator

This Practice Note provides an overview of the role of the Pensions Regulator. For information on the role of the Pensions Regulator as regards public sector pension schemes, see Practice Note: The role of the Pensions Regulator in respect of public sector schemes.Background to the roleThe Pensions Regulator (the Regulator), an executive non-departmental public body of the Department for Work and Pensions, is the UK regulator for work-based pension schemes.The post of the Regulator was created on 6 April 2005 by Pensions Act 2004 (PeA 2004), s 1 and replaced the Occupational Pensions Regulatory Authority (otherwise known as OPRA), the previous pensions regulatory body. The role of the Regulator and its powers are, however, much wider in scope than those of its predecessor.The term 'work-based pension scheme' is defined in PeA 2004, s 5(3) as meaning:•an occupational pension scheme•a personal pension scheme where 'direct payment arrangements' exist in respect of one or more members of the scheme who are employees, or•a stakeholder pension schemeFor more information on types of pension arrangements, see Practice Note: Types of pension arrangements for employees.The definition of 'direct payment arrangements' is set out under the Pensions Schemes Act 1993 (PSA 1993), s 111A(2) as meaning arrangements under which contributions fall to be paid by or on behalf of the employer towards the

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Deferred Debt Arrangement—Deed

Deferred Debt Arrangement—Deed This Deed is made the [insert day] day of [insert month] 20[insert year] Parties: 1 [●] a limited company incorporated and existing under the laws of England and Wales (registered in England and Wales No. [●]) whose registered office is at [●] (Deferred Employer); and 2 [●] a limited company incorporated and existing under the laws of England and Wales (registered in England and Wales No. [●]) whose registered office is at [●] (Trustees). Background (A) [●] (Scheme) was established by a[n] [interim OR definitive] trust deed dated [●]. (B) The Scheme is currently governed by a trust deed dated [●], as amended by the deeds executed after it[, details of which are set out in the Schedule to this Deed] (Trust Deed). The rules of the Scheme (Rules) are set out in Schedule [●] to the Trust Deed. (C) The Trustees are the present trustees of the Scheme. (D) The Deferred Employer is a participating employer in the Scheme. (E) [Set out brief background as to the circumstances in which the Deferred Employer no longer employs any active members of the scheme or has entered a period of grace]. As a result, the Deferred Employer has ceased to employ any active members of the Scheme which [would trigger OR would have triggered] an ‘employment-cessation event’ (as defined in Regulation 6ZA of the Occupational Pension Schemes (Employer Debt) Regulations

Part 26A restructuring plan (short form)

Part 26A restructuring plan (short form) (pursuant to part 26A of the companies act 2006) between [insert name of company] and its Creditors/Members (as defined in the Restructuring Plan) Dated [insert date] 1 Definitions and Interpretation In the Restructuring Plan, unless the context otherwise requires or otherwise expressly provides, the following definitions apply: Act • means the Companies Act 2006 of Great Britain; Admissible Interest • means any interest provided for in a contract or any relevant statute or any other relevant law or judgment; Admitted Claim • means the balance, if any, calculated as remaining due from the Company to a Creditor/Member pursuant to clause 12.1 following the application of set-off pursuant to clause 13.1; Agreed Claim • means the amount determined as being due from the Company in respect of a Creditor’s/Member’s Claim pursuant to clause 10; Available Distributable Amount • means the amount available for payment by the Company to its Creditors/Members pursuant to clause 15; Board • means the board of directors of the Company from time to time; Business Day • means any day other than Saturday, Sunday or any other day on which banks in the City of London are not open for business; Claim • means any claim against the Company in respect of a Liability (not being an Excluded Liability) to which the Company is subject at the Effective Date or to which it may become subject after the Effective Date by reason of an obligation incurred before that

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If an eligible jobholder had opted out of the transferor's qualifying scheme immediately before a TUPE transfer, will the transferee be under a duty to auto-enrol them into a qualifying scheme following their TUPE transfer?

If an eligible jobholder had opted out of the transferor's qualifying scheme immediately before a TUPE transfer, will the transferee be under a duty to auto-enrol them into a qualifying scheme following their TUPE transfer? As mentioned in the Practice Note: TUPE—what pension benefits should the transferee provide?, the Pensions Regulator states in its auto-enrolment guidance # 2 that, on a TUPE transfer, transferring employees ‘are treated as a new joiner’ for the new employer (the transferee). The Pensions Regulator

Could requiring employees to pay pension contributions at 1–2% higher than the statutory minimum for automatic enrolment constitute a breach of the statutory prohibition against inducements to opt out in section 54 of the Pensions Act 2008?

Could requiring employees to pay pension contributions at 1–2% higher than the statutory minimum for automatic enrolment constitute a breach of the statutory prohibition against inducements to opt out in section 54 of the Pensions Act 2008? The statutory automatic enrolment regime requires employers to enrol workers meeting certain age and earnings criteria into a pension scheme that meets at least minimum standards. In the case of a defined contribution scheme, employers and workers must pay a minimum level of contributions to the scheme. The minimum contribution rates are expressed as a percentage of a worker’s in Practice Note: Auto-enrolment—who needs to be enrolled? particularly the section ‘Qualifying earnings’. An employer may require its employees to pay a higher level of contributions to the scheme than the statutory minimum if it so wishes (there is no statutory maximum level of employee contributions). However, an employer should ensure that this does not breach the statutory prohibition in section 54 of the Pensions Act 2008, which prohibits employers from taking any action for the sole or main purpose of inducing employees to give up membership or opt out of a qualifying scheme for automatic enrolment. Breaching the statutory prohibition could subject an employer to a fine and/or imprisonment up to two years. In paras 20–23 of its guidance no. 8

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This week’s edition of Restructuring & Insolvency weekly highlights includes: the latest updates through our joint project with INSOL Europe from Italy and Estonia on the EU Harmonisation Directive, the latest news from the Insolvency Service on bankruptcy restrictions for Bounce Back Loan abuse, plus a round-up of other news and cases for restructuring and insolvency professionals.

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