It’s been a while since I was able to put a conversational post on here, as we are in peak seminar season now, and I’m just not getting the ‘desk time’ needed.

But to wrap up the week, I thought I should take a couple of minutes to update you on the big pensions news stories (from this blog’s perspective) of the week, ‘cos there are quite a few threads now seemingly approaching their final phase.

This week we have progressed on all of the following:

• The Flat Rate State Pension

A long time in the making, it looks like this one has finally moved forward. Many followers will be aware that this was included in the Queen’s speech this week, so it’s clearly a high priority for the Coalition Government to push through before all the political parties retrench for the 2015 election campaign.

• Small Pension Pots and Automatic Transfers

A topic we have covered here before, and now included in the amended Pensions Bill, so now progressing. I suspect that this one may not have quite such an easy glide-path to legislation as the Flat Rate State Pension, and it will be interesting to see what the final legislated rules look like.

It is however evident that there is a recognition that Auto-Enrolment will create many more micro pension funds (as employees move from job to job), and that something needs to be done to ensure that such funds are not lost to the employee, and protected from any possible erosion by charges (something which is much less prevalent in today’s pension world than a decade or more ago it should be noted).

• The removal of Short-Service pension refunds

Another long running topic, and also included in The Pensions Bill now, so again progress towards legislation here.

• Consultancy Charges

Many followers of this blog will be aware that the Retail Distribution Review took hold on the 1st January this year. This effectively removed the recently favoured ‘factored’ commission structure for group pension planning, which many employers had relied on to pay for their pension consultancy services.

One proposed solution to this was the concept of ‘consultancy’ charging. Under this method, funds would be directly taken from the employee’s pension fund to meet the consultancy costs.

To be honest, this idea has never got off the launch pad, and there has been a question mark hanging over consultancy charging for many months now. Any ambiguity about this has now seemingly been removed, with The Minister for Pensions today announcing the Government’s intention to ban consultancy charging in automatic enrolment schemes. We will presumably have to wait a few months to see if there is any possible way that this can still be used (for high end, non-auto enrolment schemes for instance), but for most employers it appears this option has now been completely removed from the landscape.

This does however again raise a couple of key questions. Some schemes have already been established within the industry on the consultancy charging basis, and quite possibly for Auto-Enrolment schemes. Will this legislation apply retrospectively? If so how could such a charging structure be unravelled after the event? These are interesting questions that may pose significant challenges to both employers and the industry in such cases.

So a long week in pensions, but at least we are moving towards the end game for some of the big questions of the moment.

Best regards

Steve