2019 promises plenty of developments that will keep trustees, employers and advisers busy. From Brexit to superfunds, pension professionals will have to grapple with new legislation, consultations and revised guidance. In this update, we outline nine key pension issues that are likely to dominate the pensions landscape this year, plus some other developments to look out for.

Nine key pension issues for 2019

1. Brexit means Brexit, but what will it mean for pensions?

At 11pm on 29 March 2019, the UK will leave the European Union. At the time of publication, this was the position under UK law and in line with the UK’s notice to leave under Article 50 of the Treaty on the Functioning of the European Union.

Pensions is somewhat insulated from the most immediate impacts of Brexit. Most of the relevant EU legislation has already been transposed into UK law. Pensions in the UK are regulated by The Pensions Regulator (TPR) with relatively little direct involvement from the European Insurance and Occupational Pensions Authority (EIOPA) (the European pensions regulator).

Two sets of regulations relevant to pensions have been published by the Department for Work and Pensions (DWP) and are scheduled to come into force on ‘exit day’. The regulations make minor technical changes to the UK’s pensions legislation to ensure it operates effectively once the UK has left the EU. The regulations may be amended or revoked if a deal is agreed between the UK and the EU.

We start 2019 unclear on how or even whether Brexit will be delivered. With so much uncertainty, what should trustees and employers do to prepare themselves for Brexit? Trustees should consider the issues that could become relevant to their schemes (e.g. are there investments in EU-domiciled pooled funds? Does the scheme pay benefits to non-UK bank accounts for overseas members? Are there any cross-border issues?) and be ready to act quickly if required. Employers should monitor those issues too, as they may have a cost impact on their scheme’s benefit accrual and administration.

2. A “very substantial” Pensions Bill 2019-20

In October 2018, Guy Opperman MP, the government minister responsible for pensions, stated his intention to deliver a “very substantial” bill addressing multiple areas of pensions regulation in the summer of 2019. This will be in the next parliamentary session (the first available window for non-urgent primary legislation), which is expected to begin in May 2019.

What is on the agenda for the DWP? The pensions minister is on record as supporting:

• collective defined contribution;
• defined benefit consolidation and superfunds;
• mid-life financial MOTs; and
• simplified annual benefit statements.

Other areas that might be facilitated by the Pensions Bill 2019 – 20 are pension dashboards, improving transfers and facilitating greater investment in alternative assets.Although we expect the Pensions Bill to be introduced in 2019, it is likely to be 2020 before it receives Royal Assent.

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