Stakeholder Pension Schemes Regulations 2000

The Stakeholder Pension Schemes Regulations 2000 were issued on 25 May 2000. A copy of the regulations can be found on the internet at www.legislation.hmso.gov.uk/si/si2000/20001403.htm

The following changes from the draft regulations should be noted:

1. Schemes will be able to refuse contributions made in cash or by credit card.

2. Funds held on deposit must usually generate a return of at least the base rate minus 2% p.a.

3. Contract based schemes will have to have a "reporting accountant" (rather than an auditor as envisaged in the draft regulations).

4. Trustees and managers of schemes must at least once a year make a written declaration that:

(a) expenses, charges and commission have been properly deducted from scheme funds

(b) transactions have been carried out at a fair market value

(c) members' rights have been valued in line with the provisions of the scheme

(d) proper records have been kept to enable the preparation of members' annual statements.

The auditor (trust schemes) or reporting accountant (contract schemes) must provide a statement confirming that the declaration was reasonable or state why it was not reasonable. The declaration and auditor or accountant's statement must be provided to members on request.

5. Funds can be valued on a weekly or monthly basis, as an alternative to a daily basis, for the purposes of calculating charges.

6. Employers need not offer access to a designated stakeholder to employees who have previously opted out of the employer's occupational scheme.

For further information please contact Mark Grant (Tel 020 7367 2325 or e-mail [email protected]) or Mark Atkinson (Tel 020 7367 2184 or e-mail [email protected]) or your usual contact in the pensions team.