The Stakeholder Schemes Regulations 2000

United Kingdom

The DSS has issued draft Regulations setting out detailed provisions relating to the practical implementation of stakeholder pension schemes following the completion of the first stage of the consultation process. The principal areas covered by the Regulations are:

- Scheme governance: Schemes will be allowed to be established by contract as an alternative to trusts and the Regulations set out detailed requirements which must be included in the rules of both trust-based and contract-based schemes;

- Charges: Schemes will be subject to detailed rules for calculating the 1% maximum charge and will be able to offer other services (including advice) at an additional cost, provided that these are under a separate contract and are not a condition of membership of the scheme;

- Information to members: Detailed information on contributions, fund growth and charges must be provided to members at least once a year;

- Registration: The Regulations set out the necessary requirements for registration of schemes and for general access to the register of schemes held by Opra;

- Employer access: The Regulations set out the rules governing the requirement for employers to provide access to stakeholder schemes and the circumstances in which an employer may be exempt; and

- The application of existing legislation: A large amount of existing legislation will apply to stakeholder schemes. Provisions that apply or disapply the relevant parts are detailed in the Regulations.

The draft Regulations are now subject to further consultation and it is anticipated that they will be finalised and laid before parliament shortly after Easter 2000. It is intended that stakeholder schemes will be able to begin registering with Opra and the Inland Revenue from October 2000, and that the first schemes will begin operating from 6th April 2001.

If you would like to discuss any aspect of stakeholder schemes, please contact Mark Atkinson on 020 7367 2184 or e-mail him at, or speak to your usual contact in the pensions department.