The Pensions Bill received Royal Assent on 3 November 2011. The Pensions Act 2011 will, when it comes into force makes several changes including:
The Act clarifies aspects of the switch from RPI to CPI as the basis for statutory increases, including changes to allow schemes with RPI in their rules to continue to apply RPI even in years where CPI is greater than RPI and to introduce CPI as the measure for calculating increases to PPF compensation.
Acceleration of state pension age
The Act will accelerate the planned rise in the state pension age so that it reaches 66 in 2020 (rather than 2026). Following pressure for changes to this timetable, to decrease the impact on women in their late 50s, the increase of SPA to age 66 is to be delayed by six months from April to October 2020.
Money purchase benefits
Last minute amendments to the Act deals with the decision in Bridge Trustees. The DWP had stated that it would look for legislation to ensure that benefits which may create a funding deficit may not be classified as “money purchase”. The changes made will be retrospective, with the main definition of “money purchase benefits”, as set out in the Pension Schemes Act 1993, being amended with effect from 1 January 1997. Power is given for regulations to be made modifying the effect of this