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Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill - Sitting 1

02 February 2022

Proposing MP
Clive Efford Lab
Eltham and Chislehurst
Type
Public Bill Committee

At a Glance

Issue Summary

The statement discusses the conversion of guaranteed minimum pensions under the Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill. The statement discusses a technical bill aimed at clarifying and amending provisions related to converting guaranteed minimum pensions (GMPs) in occupational pension schemes to ensure equal treatment of men and women. The MP is discussing the Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill and its potential impacts on pensioners. The statement discusses the Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill and its proposed changes to occupational pension schemes in England, Wales, Scotland, and Northern Ireland.

Action Requested

There are no specific actions requested in this statement. It is a procedural announcement for discussing clauses 1, 2, and 3 without further debate.

Key Facts

  • Clauses 1, 2, and 3 will be debated together.
  • No amendments were tabled.
  • The Bill aims to correct gender disparities in occupational pension schemes caused by Guaranteed Minimum Pensions (GMPs).
  • From April 1978 to April 1997, employers could contract out of the earnings-related additional state pension and pay GMPs.
  • Clause 1 clarifies conversion provisions for survivor benefits and employer consent issues, and removes unnecessary notification requirements to HMRC.
  • The Bill has cross-party support.
  • The Bill has potential repercussions for millions of people's pensions.
  • Communication changes have been made since 1978.
  • Previous government changes to pension age were poorly communicated.
  • Experts warn that using GMP conversion can trigger disproportionate and unintuitive pensions tax issues.
  • Parliamentarians must adequately scrutinise the regulations introduced.
  • The Bill aims to correct the unequal effects of Guaranteed Minimum Pensions (GMPs).
  • Clause 1 ensures clarity on converting GMPs into other scheme benefits, providing opportunities for equalisation.
  • Clause 2 mirrors clause 1 but applies to Northern Ireland.
  • The Government will consult industry stakeholders and follow with regulations.
  • HMRC no longer requires notification when pension schemes carry out conversion exercises due to the new state pension system.
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