What pension schemes and sponsors need to know now
01 June 2016
A substantial amount of EU pensions law has already been incorporated into UK legislation, and these laws remain unchanged. In the longer term, we may see alterations in some areas, but much will depend on the framework negotiated for the UK’s ongoing relationship with the EU.
It is the terms negotiated for exit, rather than the fact of voting to leave, or later actually leaving the EU, which are likely to determine the extent to which other areas of EU law – for example, the new General Data Protection Regulation (GDPR) – will affect UK pension schemes post-Brexit.
- Financial and economic volatility is expected during the negotiation period. This could be a significant issue for schemes.
- The legal obligation of a scheme sponsor to support its pension scheme will remain unchanged by the vote, but some employers may find that their financial ability to support the scheme in the medium to long term is (or could be) detrimentally affected. This could result from volatility in the financial markets, for example, or in the longer term if the business can no longer rely on free movement of goods, capital or people throughout the EU.