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Consultation Paper Trail
For further information, please contact Jon Bridger at the Cheltenham office.
Green Paper and Consultation Document
In December 1998 the DSS published the following documents:
- Green Paper entitled "A New Contract for Welfare : Partnership in Pensions."
- Consultation Document entitled "Strengthening the Pensions Framework."
The purpose of the Green Paper was to put forward the Government's proposals for a fundamental reform of the State Pension system including the replacement of SERPS by the "State Second Pension" and the introduction of "Stakeholder Pensions." In addition, the Consultation Document proposed simplification of the regulatory framework and subsequent easing of the compliance burden for occupational pension schemes.
Whereas reform of State Pension system will inevitably mean changes to contracting-out requirements (although the Green Paper is silent on what these changes will be), the Consultation Document is possibly of more immediate relevance to the day-to-day operation of occupational pension schemes. However, in our view, we do not see much in the Consultation Document to suggest that there will be a significant easing of the compliance burden for occupational pension schemes in the immediate future.
Read a summary of Barnett Waddingham's response to the Green Paper and the Consultation Document.
Stakeholder consultation
The Government have promised a further seven consultation papers covering the following aspects of stakeholder pensions:
- Minimum standards
- Clearing house
- Employer access (read BW's Summary & Comment)
- Trusts and governance
- Regulatory regime
- Tax regime
- Advice and information
The first five papers have already been published; the remaining two are expected within the next couple of months.
More consultation!
In addition to all of the above, various other consultation papers have been issued. Most prominent of these concerned the Quality in Pensions (QiP) accreditation scheme. These proposals, which would have increased the burden on occupational pension schemes, received a widespread thumbs-down from the pensions industry. This has led to the QiP scheme being quietly shelved by the Government. At least this shows that consultation does work!
Welfare Reform and Pensions Bill
Amongst all this consultation the Welfare Reform and Pensions Bill is currently making its way through Parliament. Rather strangely the Bill was published before the end of the Green Paper consultation period!
The Bill is intended to establish the framework for stakeholder pensions - the detailed aspects of their operation will be covered by Regulations to be published at a later date.
Jon Bridger, August 1999.