Pensions Update - February 2012
09 February 2012
Welcome to the Mason Hayes & Curran inaugural Pensions Update.
Background to this Update
During 2009 and 2010, a number of extensions were granted to the statutory deadlines for submission of funding proposals. A funding proposal is a recovery plan which must be submitted to the Pensions Board when a defined benefit pension scheme fails to meet the statutory funding standard. Effectively, there is currently no deadline for making such submissions. On 28 October 2011, the Irish government announced changes to the funding standard for defined benefit schemes. On foot of that announcement, the Pensions Board was due to publish revised guidelines for defined benefit schemes in deficit and to announce new deadlines by which schemes in deficit must submit a recovery plan to the Board.
Additionally, in October 2011, the Pensions Board published certification conditions for sovereign annuities. A sovereign annuity is an annuity contract issued by insurance companies where the annual income payment is linked directly to payments under bonds issued by Ireland or any other EU Member State. Sovereign annuities can only be purchased by the trustees of occupational pension schemes.
The following updates should be read against this backdrop.
Re-Introduction of Funding Standard Obligations for Defined Benefit Pension Schemes
On 19 January 2012, the Pensions Board announced that it hopes to publish revised guidelines on defined benefit schemes with funding deficits and deadlines by which underfunded schemes must submit funding proposals to the Board. This information has been eagerly awaited for some time and the Board apologised for the delay in publication. Click here for a full Pensions Board update.
Sovereign Annuity Regulations
1. The Occupational Pension Schemes (Disclosure of Information)(Amendment) Regulations, 2012 were signed into law on 11 January 2012. These regulations set out the information which trustees must disclose to pensioners as soon as possible when the trustees purchase an annuity in the pensioners name, or in any event within two months after purchase of the policy. Click here for a full Pensions Board update.
Trustees of occupational pension schemes need to be aware of these regulations and ensure that administration provisions are in place to facilitate compliance with these disclosure requirements if they purchase sovereign annuities.
2. The Pensions Act (Register and Database of Certified Policies or Contracts of Assurance) Regulations, 2012, were signed into law on 11 January 2012. They set out information which the Pensions Board must keep on its register and database of sovereign annuity policies which have been certified by the Board. Click here for a full Pensions Board update.
Trustees and members of the public will be able to access this register which will provide a useful source of information on those sovereign annuities which have been certified by the Board.
About the MH&C Pensions Team
Mason Hayes & Curran has grown its existing pensions law service offering having recruited an additional specialist pensions solicitor, Peggy Hughes, from another major corporate law firm to head up our Pensions Team. Working with Peggy is Deborah McHugh, Senior Associate, who is also an experienced pensions specialist incorporating a pensions litigation practice.
The team operates within our Employment Law and Benefits Group, which works alongside colleagues in our Corporate, Tax, Financial Services and Employment law practices as required to provide a comprehensive pensions legal service offering to our clients. Please click here for further information on our Pensions Team and the services provided.
To view this article as an ezine, please click here.
The content of this article is provided for information purposes only and does not constitute legal or other advice. Mason Hayes & Curran (www.mhc.ie) is a leading business law firm with offices in Dublin, London and New York. © Copyright Mason Hayes & Curran 2012. All rights reserved.