The Department for Work and Pensions launched its consultation in September last year, and experts warned at the time that the new notifiable events regime, which sets out the types of event trustees and employers are obliged to inform the regulator about, could be more impactful than its controversial criminal powers.
The DWP proposed adding two new employer-related notifiable events: the first was the sale, by an employer, of a ‘material proportion’ of its business or assets, defined as accounting for 25 per cent or more of its annual revenue or the gross value of its assets.
The second was “the intended granting or extending of a relevant security by the employer over its assets”, an arrangement where, should the employer become insolvent, a secured creditor would be ranked above the pension scheme in a priority list for debt recovery.
The draft regulations explain that ‘relevant security’ is a level of security of more than 25 per cent of the employers’ consolidated revenues or its gross assets.
The extent of the changes, and the significant penalties for non-compliance, led the Association of Consulting Actuaries to call in October for “comprehensive guidance” to be published before the new regime is introduced.
Non-compliance could result in a fine of up to £1mn and, where false or misleading information has been provided, prosecution under the Pension Schemes Act 2021.
Despite the potentially significant implications of the new events, which were expected to come into force on April 6, the government has yet to publish a response to the consultation, which closed in October.
In a blog post, law firm Herbert Smith Freehills’ regional head of practice Samantha Brown, partners Michael Aherne and Rachel Pinto, and professional support consultant Tim Smith noted that the changes “have been trailed for some time”.
They said: “The government has still not issued a response to its consultation and the final amending regulations are still awaited. It is unclear what has caused this delay.
“The proposed changes to the pensions notifiable events regime have been trailed for some time. Therefore, we still expect changes along the lines of those set out in the government’s consultation to be introduced. However, we cannot be certain when this will be.”
The DWP has been approached for comment.