Regulations finalised for contracted-out pension scheme transfers

Following the consultation, the Government has published the finalised regulations into contracted-out pension scheme transfers. They’re expected to become law on 6 April 2018 and contain some changes to the draft version, as a result of the consultation.

As the law stands, pension scheme members must give their consent before transfers of their benefits accrued in a former contracted-out scheme can be transferred to a receiving scheme which has never been contracted-out.

However, bulk transfers of this kind will be allowed without consent under the new regulations.

Before the cessation of contracting-out in 2016, a bulk transfer to a scheme that had never been contracted-out could be facilitated by the receiving scheme contracting-out temporarily. The cessation of contracting-out meant that option was no longer available.

These pension scheme transfers will still be subject to certain conditions.