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Pensions

My honourable friend the Minister of State for Pensions and the Ageing Society (Angela Eagle) has made the following Written Ministerial Statement. Today is a very important milestone for the delivery of workplace pension reform, including setting up NEST (National Employment Savings Trust), previously known as personal accounts. We are publishing the: Government’s response to the workplace pension reform "Completing the Picture" consultation; regulations that frame automatic enrolment, scheme quality, compliance and the other elements that combine to deliver workplace pension reform; regulations for NEST and establishing the corporation that will run the scheme, as well as winding-up PADA in July 2010; and associated impact assessment. These reforms deliver the final part of the package proposed by the independent Pensions Commission, and reflect a significant delivery milestone based on a broad consensus. We have worked closely with stakeholders, employers, industry, and others to get here, and the changes created by these regulations will allow millions of workers to save for a pension with a new mandatory minimum contribution from their employer, many for the first time. A guiding principle has been to establish the minimum level of effective regulation to enable pension reform to succeed without placing unnecessary burdens on employers or the pensions industry. We listened to stakeholders and considered their responses to our consultations. We have made a number of changes, which we hope will be well received. These increase flexibility and reduce some of the process burdens without compromising our headline policy intentions or undermining protection for individuals. The regulations include the changes to the implementation plan, announced in the Pre-Budget Report, which are designed to help small and start-up businesses adjust to the new arrangements for workplace pension saving. Auto-enrolment will begin as planned in October 2012 and the reforms will be fully implemented by October 2017. Also published today is The NEST order and, the order to establish NEST corporation and, as a consequence, the order that will wind up the Personal Accounts Delivery Authority on 5 July 2010. We are currently recruiting the chair and members for NEST Corporation. We will establish the corporation this summer, as only the trustee can make certain key decisions necessary to complete the implementation of the scheme for example, agreeing the statement of investment principles. As the policy and design of the scheme is established in regulations, we concluded PADA can be wound up at the same time, with the task of completing the operational implementation and the subsequent running of the scheme passed on to NEST Corporation. Regulations published today: The Occupational and Personal Pension Schemes (Automatic Enrolment) Regulations 2010 These set out the practical arrangements employers must make to automatically enrol eligible jobholders into a pension scheme, including the arrangements an individual must make if they wish to opt out of pension saving and the minimum quality standards certain schemes must reach in order to be used by employers to automatically enrol jobholders. http://www.opsi.gov.uk/si/si2010/draft/ukdsi_9780111490655_en_1 The Employers’ Duties (Implementation) Regulations 2010 These set out the arrangements for implementing the new employer duties by applying the duties to employers over a period of time according to the employers’ description. http://www.opsi.gov.uk/si/si2010/uksi_20100004_en_1 The Employers’ Duties (Registration and Compliance) Regulations 2010 These enable the Pensions Regulator to monitor and enforce compliance with the employer duties and safeguards. http://www.opsi.gov.uk/si/si2010/uksi_20100005_en_1 The Public Interest Disclosure (Prescribed Persons) (Amendment) Order 2010 This amends an existing order to ensure that any detriment or dismissal a worker suffers as a result of making a complaint to the Pensions Regulator is unlawful. http://www.opsi.gov.uk/si/si2010/uksi_20100007_en_1 The Pensions Act 2008 (Commencement No. 5) Order 2010 Establishes the NEST Corporation from 5 July 2010. http://www.opsi.gov.uk/si/si2010/uksi_20100010_en_1 The NEST Corporation Naming and Financial Year Order 2010 Sets out the name of the trustee corporation which will run NEST. Sets the financial year of the corporation in line with Government’s financial year—1 April to 31 March. http://www.opsi.gov.uk/si/si2010/uksi_20100003_en_1 The NEST Order 2010 Sets up the framework for NEST, a simple, low cost scheme which employers can use to discharge their new duty. http://www.opsi.gov.uk/si/si2010/draft/ukdsi_9780111490495_en_1 The NEST (Consequential Provisions) Order 2010, and the Application of Pension Legislation to the NEST Corporation Regulations 2010 Makes some minor modifications to existing pension legislation in relation to the scheme through The NEST Consequential Provisions Order and the Application of Pension Legislation to the NEST Corporation Regulations, for instance, that the scheme will not have member-nominated trustees, as the members’ panel will represent the views of scheme members. http://www.opsi.gov.uk/si/si2010/uksi_20100009_en_1; and http://www.opsi.gov.uk/si/si2010/uksi_20100008_en_1 The Transfer Values (Disapplication) Regulations 2010 Bans transfers of cash equivalent sums built up under other pension arrangements into and out of NEST, to ensure the scheme complements those schemes already in the existing pensions market. http://www.opsi.gov.uk/si/si2010/uksi_20100006_en_1 The Personal Accounts Delivery Authority Winding Up Order 2010 Winds up the Personal Accounts Delivery Authority from 5 July 2010. Transfers PADA’s property, rights and liabilities in the main to the NEST Corporation. http://www.opsi.gov.uk/si/si2010/draft/ukdsi_9780111490501_en_1 Documents published today: Available at www.dwp.gov.uk/workplace-pension-reforms. Workplace Pension Reform—Completing the Picture. Government response to the consultation. This covers: arrangements for implementing the reforms; elements of the employer duty requirements not covered in the consultation of March 2009; the quality requirements for defined benefit (DB) and hybrid schemes, and transitional arrangements during implementation; and powers to enforce compliance with the requirements on employers. Workplace pension reform regulations—impact assessment The impact assessment builds on the analysis presented in the regulatory impact assessments that accompanied the Pensions Bill 2007 and draft regulations consultation in 2009. It presents the overall impact of the reform on employers, individuals, the pensions industry and the Government.