The Government has introduced new regulations to correct an error in trivial commutation payments.

Last May, the Government introduced new regulations aimed at helping schemes avoid having to pay small pensions. Regardless of benefits under other schemes, they allowed schemes to pay benefits worth less than £2,000 as a lump sum from 1 December 2009. However, due to an unfortunate oversight in drafting, the regulations did not extend to guaranteed minimum pensions, severely restricting their usefulness in practice.

The Government has now laid new regulations correcting the drafting error from 6 April 2010. The DWP does not expect schemes that made payments under the regulations before becoming aware of the error to be subject to any action. However, schemes should not make any further payments until 6 April.