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Employer  >  Trustee Zone  >  OPS Matters  >  Transfer value regulations - take 3

Transfer value regulations - take 3

In Issue 10, we told you about the Department for Work and Pensions (DWP) consultation paper on moving to a scheme specific calculation basis rather than the current prescribed GN11 basis and the effect it would have on you. Well, on 11 April 2008, the DWP published its response to the consultation, which you’ll find here.

The regulations only deal with transfers out of a defined benefits scheme and not incoming transfers although the DWP and The Pensions Regulator (TPR) will be discussing this point.

More time for trustees

There were concerns raised by a number of respondents during the consultation that the preparation time for implementing the new regulations was too short. The DWP has therefore extended the implementation date by 6 months, to 1 October 2008, allowing schemes more time to prepare. You'll without a doubt welcome this move. Until that time, youcan continue to use your existing calculation assumptions.

You are not alone

The Regulator has also welcomed the introduction of the new regulations and in an effort to help you understand the new regulations and requirements is expected to publish guidance relating to the new transfer regulations. They also plan to publish new guidance for scheme members to help them in comparing the key risks with the advantages of a transfer.

We’ll let you know once the guidance has been published.

What should you do?

The new regulations put the onus of deciding the transfer value assumptions firmly at your door. But there’s help available in the form of the Actuary so you should make use of their skills and enter into discussions early so you fully understand the changes and can meet the 1 October deadline. After all, you're paying them.