Passing of Pension Schemes Bill ‘great news for UK pension schemes’

Yesterday evening the Pension Schemes Bill finally passed in the House of Lords and will soon receive Royal Assent. This is welcome news and means that the various measures impacting DB and DC schemes will in due course (and in some cases immediately) become law.

Jon Forsyth, LCP Partner and Head of Pensions Developments, commented: “The passing of the Pension Schemes Bill is great news for UK DB schemes. The new rules around surplus - as well as a permanent regime for the superfund market - will give valuable flexibility to schemes, and when used in the right circumstances can mean better outcomes for members and sponsors alike. Meanwhile the legislation to deal with the Virgin Media judgment provides a pragmatic way forward. Combine that with the changes expected to result in zero PPF levies and you have a valuable set of wins for the DB industry.”

Stephen Budge, LCP DC Partner, said: “It is disappointing to see that the mandation measure remains in the Bill given significant industry concerns; however, we welcome the restrictions agreed. This now includes the final amendment to reference competitive pricing pressures which could restrict master trust and group personal pension investment into UK private markets."

Laura Amin, LCP Partner and Head of DB Consolidation, added: “The passing of the Bill is the first step in establishing the legal framework applicable to the authorisation and supervision of DB superfunds, to replace TPR’s interim regime.  

“Combined with the growing momentum in the superfund market, with Clara having announced its fifth deal just last week, I expect this will give investors confidence and pave the way for further new providers to enter the market and will also give pension scheme trustees and sponsors the confidence that DB superfunds are a robust model to which to entrust their members’ pensions.

“The Bill also provides for the simplification of the gateway tests for schemes to transfer to superfunds and we expect this will open up the market of schemes considering DB superfund transfers from current levels. So the supply and demand side factors are lining up for 2026 to be a pivotal year for the superfund market.”