Pension Schemes Act 2017
| Jurisdiction | England & Wales |
| Citation | 2017 c. 17 |
Pension Schemes Act 2017
2017 Chapter 17
An Act to make provision about pension schemes.
[27 April 2017]
Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—
Part 1
Master Trusts
Definition of a Master Trust scheme
1 Master Trust schemes: definition
(1) In this Act, “Master Trust scheme” means an occupational pension scheme which—
(a)
(a) provides money purchase benefits (whether alone or in conjunction with other benefits),
(b)
(b) is used, or intended to be used, by two or more employers,
(c)
(c) is not used, or intended to be used, only by employers which are connected with each other, and
(d)
(d) is not a relevant public service pension scheme.
(2) Where a Master Trust scheme provides money purchase benefits in conjunction with other benefits, references in the following provisions of this Act to a Master Trust scheme are to a Master Trust scheme only to the extent that it provides money purchase benefits, except as provided in section 39(2) to (4).
(3) For the purposes of this section, an employer (“A”) is connected with another employer (“B”)—
(a)
(a) where A is, or has been, a group undertaking in relation to B within the meaning of section 1161(5) of the Companies Act 2006, or
(b)
(b) in circumstances specified in regulations made by the Secretary of State.
(4) In this section—
“employer”, in relation to an occupational pension scheme, means a person who employs or engages persons who are, or are entitled to become, members of the scheme;
“money purchase benefits” has the same meaning as in the Pension Schemes Act 1993 (see section 181 of that Act);
“occupational pension scheme” has the same meaning as in the Pension Schemes Act 1993 (see section 1(1) of that Act);
“relevant public service pension scheme” has the meaning given in section 2.
(5) Regulations under this section are subject to affirmative resolution procedure.
2 Relevant public service pension schemes
(1) For the purposes of section 1, a pension scheme is a relevant public service pension scheme if it falls within subsection (2) or (3).
(2) A scheme falls within this subsection if it is a public service pension scheme within the meaning of the Pension Schemes Act 1993 (see section 1(1) of that Act).
(3) A scheme falls within this subsection if it is—
(a)
(a) a scheme under section 1 of the Public Service Pensions Act 2013 (new public service schemes),
(b)
(b) a new public body pension scheme (as defined in section 30 of that Act), or
(c)
(c) a statutory pension scheme which is connected with a scheme referred to in paragraph (a) or (b) (and for this purpose “statutory pension scheme” and “connected” have the meanings given in that Act; see sections 37 and 4(6) of that Act).
(4) But a scheme does not fall within subsection (3) if it is a scheme specified in an order made under section 318(6)(b) of the Pensions Act 2004 (schemes excluded from definition of “public service pension scheme”).
Authorisation: applications etc
3 Prohibition on operating a scheme unless authorised
(1) A person may not operate a Master Trust scheme unless the scheme is authorised.
(2) Section 10 of the Pensions Act 1995 (civil penalties) applies to a person who breaches subsection (1).
(3) If the Pensions Regulator becomes aware that a Master Trust scheme is operating without authorisation, it must notify the trustees of the scheme that the scheme is not authorised.
(4) The notification must include an explanation that it is a triggering event for the purposes of sections 20 to 33 and of the trustees’ duties under those sections.
(5) For the purposes of this Part, a person “operates” a Master Trust scheme if the person—
(a)
(a) accepts money from members or employers (or prospective members or employers), in respect of fees, charges, contributions or otherwise, in relation to the scheme, or
(b)
(b) enters into an agreement with an employer that relates to the provision of pension savings for employees or other workers,
and references to a scheme that is “operating” or “in operation” are to be construed accordingly.
4 Application for authorisation
(1) The trustees of a Master Trust scheme may apply to the Pensions Regulator for authorisation.
(2) The application must include the following—
(a)
(a) the scheme’s latest accounts;
(b)
(b) the latest accounts of each scheme funder;
(c)
(c) the scheme’s business plan (see section 9);
(d)
(d) the scheme’s continuity strategy (see section 12).
(3) In considering an application, the Pensions Regulator may take into account any matters it considers appropriate, including—
(a)
(a) additional information provided by the applicant, and
(b)
(b) subsequent changes to the application or to any information provided by the applicant.
(4) The application must be made in the manner and form specified by the Pensions Regulator.
(5) The Secretary of State may make regulations setting out—
(a)
(a) other information to be included in an application, and
(b)
(b) the application fee payable to the Pensions Regulator.
(6) Regulations under this section are subject to negative resolution procedure.
5 Decision on application
(1) Where an application is made for authorisation of a Master Trust scheme under section 4, the Pensions Regulator must decide whether it is satisfied that the scheme meets the authorisation criteria.
(2) The Pensions Regulator must make that decision within the period of six months beginning with the day on which it received the application.
(3) The authorisation criteria are—
(a)
(a) that the persons involved in the scheme are fit and proper persons (see section 7),
(b)
(b) that the scheme is financially sustainable (see section 8),
(c)
(c) that each scheme funder meets the requirements set out in section 10,
(d)
(d) that the systems and processes used in running the scheme are sufficient to ensure that it is run effectively (see section 11), and
(e)
(e) that the scheme has an adequate continuity strategy (see section 12).
(4) If the Pensions Regulator is satisfied that the Master Trust scheme meets the authorisation criteria, it must—
(a)
(a) grant the authorisation,
(b)
(b) notify the applicant of its decision, and
(c)
(c) add the scheme to its list of authorised Master Trust schemes (see section 13).
(5) If the Pensions Regulator is not satisfied that the Master Trust scheme meets the authorisation criteria, it must—
(a)
(a) refuse to grant the authorisation, and
(b)
(b) notify the applicant of its decision.
(6) A notification under subsection (5) must also include—
(a)
(a) the reasons for the decision, and
(b)
(b) details of the right of referral to the First-tier Tribunal or Upper Tribunal (see section 6).
6 Referral to Tribunal of refusal to grant authorisation
(1) If the Pensions Regulator refuses to grant authorisation to a Master Trust scheme, the decision may be referred to the Tribunal by—
(a)
(a) the trustees, or
(b)
(b) any other person who appears to the Tribunal to be directly affected by the decision.
(2) In this section “the Tribunal”, in relation to a referral under subsection (1), means—
(a)
(a) the First-tier Tribunal, in any case where it is determined by or under Tribunal Procedure Rules that the First-tier Tribunal is to hear the reference;
(b)
(b) the Upper Tribunal, in any other case.
Authorisation criteria
7 Fit and proper persons requirement
(1) This section applies for the purposes of enabling the Pensions Regulator to decide whether it is satisfied that the persons involved in a Master Trust scheme are fit and proper persons (see section 5(3)(a)).
(2) The Pensions Regulator must assess whether each of the following is a fit and proper person to act in relation to the scheme in the capacity mentioned—
(a)
(a) a person who establishes the scheme;
(b)
(b) a trustee;
(c)
(c) a person who (alone or with others) has power to appoint or remove a trustee;
(d)
(d) a person who (alone or with others) has power to vary the terms of the trust under which the scheme is established (where the scheme is established under a trust);
(e)
(e) a person who (alone or with others) has power to vary the scheme (where the scheme is not established under a trust);
(f)
(f) a scheme funder;
(g)
(g) a scheme strategist;
(h)
(h) a person acting in a capacity specified in regulations made by the Secretary of State.
(3) The Pensions Regulator may also assess whether each of the following is a fit and proper person to act in relation to the scheme in the capacity...
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