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Early draft of the code of practice

This code is not in force yet. It is an early version for the new code of practice consultation.

To give us feedback on issues such as the design, usability and navigation of this code, email us at

You can also read more information about the consultation.

Published: 17 March 2021

Under section 249A of the Pensions Act 2004,SM1 governing bodies of certain schemes must establish and operate an effective system of governance (see Scheme governance) including internal controls. However, there are certain exemptions.SM2

Under section 249B of the Pensions Act 2004, scheme managers of public service pension schemesSM3 are required to establish and operate internal controls which are adequate for the purpose of securing that the scheme is administered and managed in accordance with the scheme rules,SM4 and with the requirements of the law.

As part of their internal controls governing bodies should ensure that they take appropriate steps to mitigate the risk of scams.

Governing bodies should be aware of the warning signs of a scam and consider whether any are present when dealing with transfer requests (see Transfers) and requests for early retirement.

When members ask to transfer out of a scheme, the governing body should carry out due diligence on the scheme to which the member wishes to transfer, to check whether the transfer can legally be paid.

This includes checking whether the scheme is registered with HM Revenue and Customs for tax purposes, and potentially obtaining professional advice on their obligations.

Governing bodies should take steps to ensure their members are aware of the risks of pension scams.

They may do this by including clear information on how to spot a scam in all relevant communications to members, including within standard communication materials such as the retirement wake-up pack and in annual benefit statements. Scams warning messages may also be placed on the scheme’s website.

The Pension Scams Industry Group (PSIG) Code of Good Practice is a helpful tool for governing bodies looking to protect members from scams.

Further information can be found under the scams section of the TPR website.

Legal references

SM1Articles 226A of the Pensions (Northern Ireland) Order 2005.

SM2Section 249A(3) of the Pensions Act 2004
[Article 226A (3) of The Pensions (Northern Ireland) Order 2005]

SM3As defined in in section 318(1) of the Pensions Act 2004
[Article 2(2) of The Pensions (Northern Ireland) Order 2005]

SM4As defined in Section 318(2) of the Pensions Act 2004
[Article 2(3) of The Pensions (Northern Ireland) Order 2005]