As part of its policy of achieving better outcomes for pension savers, the government has focused on protecting pension scheme members from scams. These protectionary measures are important, given the widespread issue of scamming in the pensions sector. The Pension Scams Industry Group, a voluntary body set up to tackle pension scams, estimates that since 2015, 40,000 people have lost up to £10 billion in pension savings as a result of pension scams.
The three layers of protection are to ban cold calling, make it harder for fraudsters to open pension schemes, and to limit the statutory right of members to transfer to other pension schemes. The first two of these were introduced in 2019, but the focus of this article is on the implications of limiting members’ statutory right to transfer, introduced in the Occupational Pension Schemes (Conditions for Transfer) Regulations 2021 (SI.1237) (the Regulations), and the impact the Regulations have had so far.
Since the coming into force of the Regulations on 30 November 2021, where a member exercises their statutory right to transfer their pension benefits, it will only proceed in the event that one of the specific conditions in the Regulations is met.
Conditions
The two transfer conditions under the Regulations are:
Condition One: Where the trustees of the transferring scheme have satisfied themselves beyond reasonable doubt that the receiving scheme is an established public service pension scheme, a master trust or a…
