Yet More Changes to "Employer Debt" Legislation

Originally published 7 July 2011

Keywords: Pensions Act, amendments, buy-out, FAA, flexible apportionment arrangement, trustees, s75,

The Government is proposing to amend (for a twelfth time!) the Regulations under s75 Pensions Act 1995. The amendments would make it easier to vary the basis on which liability is shared between employers.

Background – the Regulations as they stand

Under a multi-employer scheme, each employer is potentially liable to make good a share of any buy-out deficit. The Regulations specify a default basis for determining the employers' respective shares. Under the default basis, an employer's share depends on the scheme liabilities which relate to that employer. But the Regulations go on to say that the shares of employers can be varied, by means of a scheme apportionment arrangement ("SAA").