Member-nominated trustees

United Kingdom
05/02/2002
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It now seems that regulations setting out the detail of the new member-nominated trustee regime (which will remove the existing employer opt-out facility) will be delayed pending the outcome of the Pickering Review on pensions simplification.

What is the position in the meantime?

Under the existing regulations:

  • Employer opt-out arrangements usually last for six years.
  • Most schemes had their opt-outs approved with effect from a date between 6 November 1996 and 6 October 1997.
  • If employers wish to opt-out again, they must give the trustees notice of their intention to do so 6-12 months before their current arrangements expire.

Therefore some employers could be required to act by 6 May 2002 if they want to opt-out again. Employers then have 6 months from giving notice to trustees to consult with members and notify the trustees of the result.

It is hoped that new regulations, either implementing the new regime or providing an interim solution will be in force before 6 May 2002. However, in the meantime, employers need to ensure that they are aware of the last date for giving notice if they wish to opt-out again. Schemes should therefore begin reviewing any necessary actions now and seek legal advice on the options open to them.

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