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Checklist for approval of CVAs involving the Pension Protection Fund

Checklist for approval of CVAs involving the Pension Protection Fund This Checklist sets out guidance to consider when drafting and seeking approval of a company voluntary arrangement (CVA) where the Pension Protection Fund (PPF) are involved. It is based on a guidance note 5 issued by the PPF in 2018 (see PPF Guidance Note 5: CVAs). When a company which is an employer (or all employers, in the case of a last man standing scheme) lodges a CVA proposal in court, a PPF assessment period will commence. The PPF will acquire the pension trustees’ voting right under section 137 of the Pensions Act 2004 (see Practice Note: The Pension Protection Fund—eligibility and entry). Essentially, the PPF will normally vote in favour or against a proposal rather than abstain from voting. The PPF is always concerned to ensure that it doesn’t set any precedent that would permit any pension schemes to be weakened where there is a possibility of PPF entry in the foreseeable future (the PPF note that...

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How to manage scheme funding deficits

STOP PRESS: On 4 December 2024 the Pensions Regulator (TPR) finally published the updated employer covenant guidance for trustees of DB pension schemes, aligned with its new DB funding code of practice which was brought into effect on 12 November 2024 by the Pensions Act 2004 (Code of Practice) (Defined Benefit Funding) Appointed Day Order 2024, SI 2024/1143. Described by TPR as ‘the last piece of the jigsaw to help schemes carry out valuations under the new DB funding code’, the updated guidance includes the first regulatory definition of employer covenant aiming to provide greater market certainty and promote consistency across schemes. Key updates encompass cash flow analysis, reasonable affordability assessments, maximum affordable contributions, reliability periods, covenant longevity, and contingent assets. The updated guidance emphasises proportionality in covenant assessments and includes worked examples for complex areas. Significantly, TPR expects trustees to use the updated guidance to review whether their existing covenant analysis is focused in the right areas and remains proportionate, especially where trustees have experienced significant changes in their...

Money purchase benefits—the statutory definition

Money purchase benefits—the statutory definition The question of the nature of money purchase benefits has attracted considerable attention over recent years. Given the onerous and growing financial burdens that defined benefit pension arrangements can impose on employers, the ability to identify clearly and unambiguously the nature of pension scheme benefits has become increasingly important. This is particularly so in the case of hybrid pension arrangements, which typically contain a variety of different types of benefits. For further information on types of pension arrangements, see Practice Note: Types of pension arrangements for employees. For most purposes, a benefit is a ‘money purchase benefit’ if it falls within the statutory definition of that term in the Pension Schemes Act 1993, s 181 (although, in some cases, an equivalent definition of the term is contained in another provision, eg in the Pensions Act 2008, s 99 in relation to auto-enrolment). Whether a benefit is money purchase in nature may affect the treatment of that benefit under pensions legislation in a...

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Special administration—witness statement in support of application for special administration

Special administration—witness statement in support of application for special administration Applicant [NAME OF WITNESS] First Witness Statement Date: [] Exhibit [XX1] Court Reference No: [INSERT COURT REF. NUMBER] [ IN THE HIGH COURT OF JUSTICE] BUSINESS AND PROPERTY COURTS [OF ENGLAND AND WALES] [IN [INSERT LOCATION]] [COMPANY & INSOLVENCY LIST (ChD)] OR [IN THE COUNTY COURT AT [INSERT LOCATION]] [BUSINESS AND PROPERTY COURTS LIST] OR [IN THE HIGH COURT OF JUSTICE] [CHANCERY DIVISION] OR IN THE MATTER OF [INVESTMENT BANK NAME] AND IN THE MATTER OF THE INVESTMENT BANK SPECIAL ADMINISTRATION REGULATIONS 2011 AND IN THE MATTER OF THE INSOLVENCY ACT 1986 _________________________________________ WITNESS STATEMENT OF [WITNESS NAME] ___________________________________________ I, [witness name], director [and chairperson] of [investment bank name] of [investment bank address] WILL SAY AS FOLLOWS: 1 I am [a director and] [the chairperson] of [investment bank address] with company number [company number] (the Company). The Company is a wholly-owned subsidiary of [insert details], a company incorporated in [location]. It is in...

Local government outsourcing contract—template pensions schedule

Local government outsourcing contract—template pensions schedule 1 Interpretation 1.1 The following definitions and rules of interpretation apply in this Schedule: Admission Agreement • means the admission agreement to be entered into on or around the date of the [Outsourcing Contract] between the administering authority of the LGPS and the Supplier Best Value Direction • means the Best Value Authorities (Staff Transfers) Pensions Direction 2007 Broadly Comparable Pension Scheme • a pension scheme formally certified by the Government Actuary’s Department as broadly comparable to the LGPS Customer’s Scheme • the [ [LGPS] OR [other pension scheme] currently operated by the Customer in respect of the Relevant Employees] Fair Deal Guidance • HM Treasury Fair Deal for staff pensions: Staff transfer from central government (October 2013) Onward Transfer Date • the date of transfer of Onward Transferring Employees of the Supplier pursuant to TUPE 2006 on expiry (or earlier termination) of the [Outsourcing Contract] Onward Transferring Employees • the employees of the Supplier who...

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Upper Tribunal decides that HMRC lawfully refused late claim under Statement of Practice 5 (2001) (R (on the application of Rettig Heating Group UK Limited (in liquidation)) v HMRC)

Tax analysis: In R (on the application of Rettig Heating Group UK Ltd (in liquidation)) v HMRC, the Upper Tribunal (UT) decided that HMRC lawfully refused the taxpayer’s claim to set off a non-trading loan relationship deficit (NTLRD) against profits for an accounting period that ended more than 18 years before the claim was made.

Financial Services—other developments (09/05/2025)

: A round-up of other developments, which have not been covered in full by the ³ÉÈËÓ°Òô Financial Services practical guidance team but may nevertheless be of interest.