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Are you saving enough?
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Are you saving enough?Autumn Statement 2023
Autumn Statement 2023 and how it affects pension saving
On 22 November 2023, Chancellor Jeremy Hunt presented the Autumn Statement.
While very little is changing immediately, there were plenty of announcements about possible changes that might impact pension saving in the future.
So, what pension announcements were made?
Announcements for all schemes
- The government is committed to maintaining the Triple Lock. This means the basic State Pension, new State Pension and Pension Credit will increase by 8.5% in 2024-2025, in line with average earnings growth.
The new full State Pension will increase from £203.85 per week in 2023-24, to £221.20 per week in 2024-25. This is an increase of £17.35 per week, or £902.20 a year, if a pensioner receives 52 weeks of State Pension.
- In the Spring Budget 2023, the government announced plans to bring in legislation to abolish the Lifetime Allowance (LTA). This legislation will be effective from 6 April 2024. Although the LTA is being abolished, the most you will be able to take as a tax-free lump sum will be £268,275. This is equal to one-quarter of the previous LTA.
- To support pension scheme investment into the UK’s most innovative companies, the government is committing £250 million to 2 successful bidders in the Long-term Investment for Technology and Science (LIFTS) initiative, subject to final
agreement. The government also confirmed its intention to establish a Growth Fund within the British Business Bank (BBB).
- Plans to improve pension trustee skills, capability, and culture will continue. This includes supporting The Pensions Regulator (TPR) to implement a trustee register, and encourage trustee accreditation.
Announcements for defined benefit (DB) schemes
- A public sector consolidator will be established by 2026, aimed at closed DB schemes that are unattractive to commercial providers.
The government feels the Pension Protection Fund (PPF) would be well placed to run such a scheme, and will launch a consultation to consider the design and eligibility for such a consolidator.
Announcements for defined contribution (DC) schemes
- A call for evidence will be launched on the possibility of a move towards savers having 1 pension ‘pot for life’. The ‘pot for life’ would allow savers to choose an existing pension scheme that employers have to contribute
to.
- A framework will be introduced to allow pension pots under £1,000 to be moved into one of a small number of authorised schemes. This will help savers to consolidate their pension pots, rather than having lots of small pension pots.
- The government intends to go ahead with proposals discussed in July 2023, for DC scheme trustees to offer decumulation services, and products when members access their DC funds. Decumulation is when pension savings are converted into retirement income. The government will bring legislation in for this at the earliest opportunity.
Matt Riley
Manager
Matt joined Zedra Governance Limited (formerly PTL) in January 2008 having previously worked for Mercer Limited, Hazell Carr and Prudential.
As a Manager for the company's Birmingham Office, Matt’s responsibilities include working closely with Client Directors and individually liaising with Employers, Trustees and Members to ensure the smooth running of their pension schemes. Matt’s current portfolio of clients covers ongoing, paid-up and winding-up schemes. In addition, Matt has experience of schemes that have transferred or are in the process of transferring to the Pension Protection Fund and Financial Assistance Scheme. Matt also works closely with clients in relation to risk registers and internal controls.
Matt particularly enjoys resolving issues in a fair and pragmatic way ensuring that the right result is reached for the member or employer.
Sam Burden
Client Director
Sam Burden joined Zedra Governance (formerly PTL) in 2022. He is an Accredited Professional Pension Trustee (AMAPPT) and an Associate of the Pensions Management Institute (APMI)
Sam has more than 25 years’ experience in the pensions industry gained with WTW, KPMG, and Standard Life working with a wide range of pension schemes and sponsoring employers. His trustee appointments include DB, DC and hybrid pension schemes and he has experience of handling a broad range of projects relating to the management of pension schemes.
Beyond his pensions experience Sam is a former Birmingham City Councillor where he chaired the audit committee and a current charity trustee.
Payam Kazemian
Client Director
Payam Kazemian joined Zedra Governance Limited (formerly PTL Governance Limited) in 2021. He is an Accredited Professional Pension Trustee (AMAPPT) and an Associate of the Pensions Management Institute (APMI).
Payam has more than 17 years of experience in the pensions industry. Through his current role as a professional trustee, as well as previously as a pension’s de-risking and investment structuring expert at financial institutions including Goldman Sachs and Deutsche Bank, he has had overall responsibility for creating investment, de-risking, journey planning, and governance solutions for a wide range of UK DB pension schemes. He currently holds a number of board positions (as Chair of Trustees) and sole trustee in his professional trustee capacity. Payam has been involved with a number of pensions projects including pensions buy-in, pensions buy-out, GMP equalisation, investment strategy reviews, and dialogue with the pensions regulator. Payam looks to create and believes in a collaborative relationship between the sponsor, the trustee, and all other parties involved as this results in best member outcomes and helps deliver pragmatic solutions for scheme. Aside from his pensions experience, Payam holds a Ph.D. in Materials Science from the University of Cambridge.
