Trustees of defined benefit (’DB‘) schemes have just six months remaining to pass a resolution enabling the retention of their right to make repayments out of surplus to a scheme employer. Most DB schemes contain a power for the trustees to make payments out of a funding surplus to the employer in certain circumstances. Where schemes had this power prior to 6 April 2006, from 6 April 2016 the power will be lost unless certain steps are carried out in accordance with section 251 Pensions Act 2004, which includes the scheme trustees passing a resolution preserving that power.
Employers may request that the trustees pass a resolution, but they should be aware that there is no obligation on the trustees to do so. Further, trustees must give members at least three months’ advance notice of any resolution to amend the scheme and they must also be satisfied that the resolution is in the scheme’s’ interests.