Pensions: what's new this week - 26 September 2022

Mini-Budget: regulations on DC performance fees, change to basic rate tax

The measures announced by the Chancellor in his 'Growth Plan' on Friday included confirmation that the government intends to accelerate draft regulations to remove certain performance fees from the scope of the DC charge cap, to give DC schemes ‘the clarity and flexibility to invest in the UK’s most innovative businesses and productive assets creating opportunities to deliver higher returns for savers’. This is part of a drive to provide investment to scale up the UK’s science and technology firms. A consultation on the proposal in November 2021 brought mixed responses, and the government said earlier this year that it would engage further to explore how concerns might be addressed. No further details are currently available.

In other pensions-related announcements, the basic rate of income tax is to be cut to 19% from April 2023 and the Growth Plan document notes that there will be a one year transitional period for schemes operating Relief at Source to permit them to continue to claim tax relief at 20%.

Read the Growth Plan 2022 document.

Update on timings of TPR developments

While speaking at the Society of Pension Professionals conference on 22 September, Charles Counsell, chief executive of the Pensions Regulator (TPR), gave an update on timings of some developments currently awaited by the industry:

• the revised DB funding code of practice is due to be published later this year, following the publication of the draft DB funding regulations in August (read more about the DB funding regulations);
• the finalised single code of practice is expected ‘soon’; Mr Counsell suggested this would be either before the end of the calendar year or TPR’s financial year, which runs to 31 March (read more about the single code of practice); and
• Mr Counsell could not give an update on the new notifiable events code of practice, saying this was ‘in the hands of ministers’ (read more about the expansion of notifiable events).

Dates for your diary: Pensions Academy Online – 31 October, 2 and 4 November

We will be running our next Pensions Academy Online (an update on issues for pension schemes and the people that run them) on 31 October, 2 November and 4 November, 9:30 – 10:30 a.m. Sessions will cover a range of issues currently on schemes’ agendas including the single code, dashboards, transfer issues and a general legal update. Full details will be available shortly.