The Pensions Regulator

Key points

• Schemes should have an appropriate process in place to help members (or dependants) who want to convert money purchase funds into an income.
• As an alternative to the scheme's process, the member or dependant can take the open market option. It's therefore important that trustees determine the best approach for their scheme and its members (or dependants).
• The Pensions Regulator is keen to encourage trustees and employers to recognise and emphasise to members (and dependants) the advantages of obtaining financial advice.
• This guidance is intended primarily for trustees of occupational DC schemes that are registered pension schemes and highlights key points for consideration, including good practice recommendations.
• However, it applies to all occupational schemes that are registered schemes and that offer benefits on a DC basis or where a cash sum is used to provide a pension. (This includes AVC arrangements in an occupational scheme regardless of whether it provides other DC benefits.) It does not apply to group personal pension schemes.
• It will also be of interest to employers who sponsor occupational schemes, those involved in advising trustees (employee benefit consultants, IFAs and legal advisers), those involved in the administration of DC schemes, providers of annuities and IFAs who offer advice to members (or dependants).