Pension Schemes Act 2021  - Important new TPR powers in force from today!

United Kingdom

Today marks the coming into force of many of the provisions of the Pension Schemes Act 2021 which strengthen the Pensions Regulator’s (TPR’s) powers and are intended to protect pension schemes from unscrupulous corporate behaviour, but potentially go further than that.

There are two new criminal offences relating to the avoidance of employer debts and conduct risking accrued scheme benefits. Both could lead to up to seven years imprisonment or an unlimited fine and can potentially apply to a broad range of people (not just employers).

In addition:

  • TPR has two new grounds on which it can issue Contribution Notices (up to the full value of the buy-out debt) under its moral hazard powers;

  • civil fines of up to £1m can be levied on individuals for failure to notify TPR of certain events, failure to comply with a Contribution Notice and for supplying false or misleading information to TPR or to the trustees; and

  • TPR has much expanded powers of interview and inspection.

Also from today, new climate change governance and reporting requirements come into force. Schemes with assets of £5bn or more will be the first to come in scope.

The Act also introduces new laws in relation to transfer payments, scheme funding, collective DC schemes, pensions dashboards and more, which will come into force over the coming months and years. 

The CMS Pensions Team has produced this detailed Guide to all aspects of the Act. We will be updating the Guide (now in a new easy to read format) as and when there are further developments, so it will be a living reference work.