The Pensions Regulator issues guidance on Russia/Ukraine & new stronger nudge requirements
Guidance on Russia/Ukraine
The Pensions Regulator has issued guidance on the conflict in Ukraine. The guidance is fairly short and a 'must' read for trustees and advisers as its sets out the Regulator's expectations on what any trustee/scheme exposure review should include.
Guidance on the 'stronger nudge' to Pension Wise
The Regulator has also updated its guidance on communicating and reporting for DC schemes. The retirement communications part has been updated to reference the stronger nudge to Pension Wise requirements which are coming into effect on 1 June 2022 (see our Insights here and here).
The guidance notes that a Pension Wise appointment should be booked early on as a matter of good practice. It also includes example declaration wording for members to confirm that they have received guidance or wish to opt-out (a separate opt-out declaration is required except in certain limited circumstances).
The opt-out can be provided by way of telephone call, online opt out form or separate form.
As noted in the guidance, schemes will need to take action to ensure that their processes and communications are updated to include the new requirements in sufficient time to meet the 1 June 2022 deadline.
Schemes are also encouraged to contact the Regulator (at firstname.lastname@example.org) if they or the employer are facing substantial issues because of the conflict.
PPF reassurance on exposure to Russian investments
The Pension Protection Fund has also issued a statement on the Russia/Ukraine situation reassuring members and levy payers that its "total investment exposure to Russia is negligible", currently less than 0.01%. Consequently, the PPF does not believe that there will be a significant financial effect on the fund, and it is presently liaising with asset managers to end current holdings as soon as possible.
The PPF recognises the current instability in financial markets and that this could in turn affect some PPF-eligible schemes – it will continue reviewing changes and take protective action should this be necessary.
Private members' auto-enrolment bill delayed
The Pensions (Extension Of Automatic Enrolment) Bill has not received its scheduled second reading in the House of Commons on 25 February 2022. This is the private members' bill which would expand auto-enrolment to all jobholders aged at least 18 and remove the lower qualifying earnings threshold.
The Pensions Minister has referred to it being a 'reality' that the bill will not progress in time for the Queen's Speech, which usually takes place in May but that the Government remain committed to taking 'the matter forward'.