Week ending 15 March 2019
No spring forward for pensions
The Chancellor’s Spring Statement lacked any direct pension news, perhaps not surprisingly given continuing Brexit uncertainty. However, documents published alongside the speech did touch on a few areas of importance to pension schemes, as follows:
- the future of RPI remains in some doubt, as the Chancellor confirmed that the government will consider the recommendations of the House of Lords Economic Affairs Committee in January 2019 (the Committee’s report highlighted the well-known flaws in the index);
- the Treasury’s Debt Management Office confirmed plans, as set out in last year’s Budget, to reduce the issuance of indexlinked gilts; and
- there will be a call for evidence on simplifying the process of amending a tax return, which could be relevant to the reporting of annual allowance tax charges.
Changes to investment consultancy
Following the Competition and Markets Authority’s probe into investment consultancy and fiduciary management services, a joint letter from HM Treasury, TPR and the DWP has been sent to the CMA saying that they agree with the CMA’s proposed remedies. Both TPR and the DWP plan to consult on proposals to implement these later in 2019, while the Treasury is more cautious, saying only that it will consider the recommendations and consult in due course.
Replacing the FRC
The Government has launched a consultation to replace the FRC with a new regulator called the Audit, Reporting and Governance Authority (ARGA). ARGA will have a new mandate, leadership, and stronger statutory powers and be responsible for audit, corporate reporting and corporate governance. Establishing the regulator will require primary legislation so could be delayed by other calls on Parliament’s time.
No further action against Johnston Press
The Pensions Regulator has published a report explaining its decision not to take any further action against Johnston Press in relation to the “pre-pack” arrangement which saw the company’s DB scheme enter Pension Protection Fund (PPF) assessment last year. TPR had initially opened an anti-avoidance investigation but, after thorough investigation, has found no evidence to suggest that insolvency was avoidable or that going into administration was planned to avoid payment of deficit repair contributions.