UK Pensions – A new regime for pension scheme transfers

Most members have a statutory right to transfer their pension benefits to another pension scheme. Trustees are not currently able to prevent transfers from going ahead where members have such a right, even if they are concerned the member has fallen for a scam. In order to tackle the risk of scams, the Government included provisions in the Pension Schemes Act 2021 designed to limit the statutory right to transfer.

Following a consultation earlier in the year, the final regulations have been published and will come into force on 30 November. Under the new regime, trustees must not comply with a transfer request unless one of the conditions set out in the regulations is met. This will give trustees a valuable weapon in the fight against scams, but it is something of a double-edged sword. The regulations place new and potentially onerous obligations on trustees, with the risk of member complaints if they get it wrong. And the short timeline before they come into force means that trustees will need to act quickly to put new processes in place.

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