Overview

This bill prevents pension scheme trustees and managers from being indemnified against penalties for breaking rules related to the new pensions dashboards system. This means that if they are fined for non-compliance, they cannot recover the costs from the pension scheme.

Description

The Pensions Dashboards (Prohibition of Indemnification) Bill amends existing legislation to explicitly prohibit indemnification for penalties related to the pensions dashboards. Specifically:

• Amendment to the Pensions Act 2004: Section 1(1) amends section 256 of the Pensions Act 2004, adding penalties under the pensions dashboards regulations to the list of those for which indemnification is prohibited.
• Amendment to the Pensions (Northern Ireland) Order 2005: Section 1(2) makes a similar amendment to Article 233 of the Pensions (Northern Ireland) Order 2005.
• Commencement and Extent: Section 2 details the commencement dates for the amendments (to be set by the relevant Secretaries of State) and specifies that the bill applies to England, Wales, Scotland and Northern Ireland.

Government Spending

The bill is not expected to have a significant direct impact on government spending. The cost of implementation and enforcement of the pensions dashboards regulations will remain largely unchanged. The impact on government spending is indirect - ensuring accountability of trustees and managers may reduce financial risks.

Groups Affected

• Pension scheme trustees and managers: They will no longer be able to claim indemnification for penalties related to pensions dashboards regulations, increasing their personal liability for non-compliance.
• Pension scheme members: Indirectly affected. The bill aims to improve the security and proper functioning of the pensions dashboard system, which could ultimately protect members’ pension benefits.
• Government: The increased accountability may lead to better compliance with the pensions dashboards regulations, reducing the need for costly government intervention.

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