The new pensions flexibilities available from 6 April 2015 have resulted in changes to disclosure of information requirements. Not only are there new legal duties, but the high risk of "mis-selling" scandals means that member communications could be closely scrutinised in the future.
For money purchase benefits, are "wake up" packs ready for members approaching retirement?
Do they clearly describe the options available under the scheme rules? (A generic description of what the law allows will not be sufficient to meet this requirement.)
Do they contain an estimate of the value of the member's benefits and flag any features such as guarantees which may affect value?
If members may also have defined benefits within the scheme, is the existence of these flagged, with information about how to access them?
Do they properly signpost the Pensions Wise guidance and contain other standard warnings and information?
Do application forms for taking benefits comply with legal requirements and the standards in in the Pensions Regulator's guidance?
Are forms sent out separately from the wake up pack at a later date?
Do they properly explain a member's options in terms that the member can be expected to understand?
Do they contain relevant risk warnings and properly signpost the Pensions Wise guidance?
Are communications ready where a member over 55 (or approaching that age) contacts the trustee about his money purchase benefits?
For members with defined benefits, have communications about transfer values been updated?
Do they include the required explanation of the need to take "appropriate independent advice"?
Do the trustees have wording ready for other communications which require information about "appropriate independent advice"?
If a survivor will be entitled to exercise benefit options on a member's death, are communications ready to cover this?
Has the scheme booklet been updated?
Misleading information is a common source of complaints and claims, with the Pensions Ombudsman a source of remedies, as well as the courts for higher value claims.
In addition, the Pensions Regulator can fine trustees up to £5,000 (or £50,000 in the case of a corporate trustee) for failing to comply with the disclosure regulations.
Regulator guidance specifically states that accountability for scheme communications remains with the trustees, even if communications are sent out by the scheme administrator, signalling no sympathy for a defence from trustees which says the scheme administrator or provider drafted the communications. Trustees should therefore make sure they devote sufficient resources to making sure member communications are right.