Key Dates

The Pension Schemes Act 2021 (Commencement No 3 and Transitional and Savings Provisions) Regulations 2021/950 made on 24 August 2021.

Summary

Provisions in the Pension Schemes Act 2021 (PSA21) which extend the powers of the Pensions Regulator (tPR) and introduce new criminal offences and civil sanctions will come into force as expected on 1 October 2021.  Commencement Order No 3, which brings the provisions into force, also disapplies some of the new powers, offences and sanctions where an act, failure to act, or part of a course of conduct took place before 1 October 2021.

The provisions coming into force on 1 October 2021 include the following.

• Financial penalty up to £1m (section 115 PSA21):
  • tPR’s new power under section 88A Pensions Act 2004 to impose a financial penalty up to £1m in specified circumstances (a “s88A penalty”);
• Contribution notice (CN) regime (sections 103 – 106 PSA21):
  • Introduction of the new employer insolvency and employer resources tests for issuing a CN;
  • Extension of the factors tPR must take into account when considering the reasonableness of issuing a CN to include the effect of the act (or failure to act) on the value of the assets or liabilities of the scheme (or of a  relevant transferee scheme);
  • Introduction of a new criminal offence or a potential s88A penalty for failure to comply with a CN;
• Avoidance of employer debt or conduct risking accrued scheme benefits (section 107 PSA21):
  • New criminal offences and financial penalties under new sections 58A – 58D Pensions Act 2004;
• Notifiable events (section 108 PSA21):
  • Power for tPR to impose a s88A penalty for failure to comply with the notifiable events requirements of section 69 Pensions Act 2004 (replacing tPR’s existing power to impose penalties under section 10 Pensions Act 1995);   
  • Commencement Order No 3 does not, however, bring into force the new section 69A, which will extend the notifiable events regime in relation to employer events;
• tPR’s information gathering powers (sections 110 – 113 PSA21):
  • Extension of tPR’s powers to gather information, including new powers to require a person to attend an interview and to inspect premises;
  • Introduction of a potential s88A penalty for provision of false or misleading information to tPR or the trustees in certain circumstances;
  • Introduction of fixed and escalating penalties for failure to comply with a requirement of tPR under its information gathering powers. 

Transitional provisions

• Where an act or failure to act (or the first act or omission in a series or course of conduct) took place before 1 October 2021:
  • The CN provisions (including criminal and civil penalties for failure to comply with a CN) will apply as if changes under PSA21 were not yet in force;
  • The new criminal offences or financial penalties for avoidance of employer debt or conduct risking accrued scheme benefits will not apply.
• The new penalties will not apply in relation to obligations to notify tPR of certain events; provide tPR with information; or permit tPR to inspect premises, where the obligations arose before 1 October 2021.

Date Accessed: 03/12/2021