HL UK Pensions Law Digest 17 April 2026

Welcome to our latest update, in which we cover:

Pension Schemes Bill: Ping Pong commences

• The government has rejected the Lords' amendments as the Bill enters its final stages;

Pension Protection Fund: response to the government's consultation on the future of trusteeship

• The Pension Protection Fund (PPF) has published its response to the government's consultation, Trust-based pension schemes: Trustees and governance, building a stronger future;

Upper Tribunal (Administrative Appeals Chamber): decision set aside because of error of law

• The Upper Tribunal (Administrative Appeals Chamber) has set aside a First Tier Tribunal decision on the grounds that it had erred in law in relation to electronic service;

Pensions Ombudsman: administrator not responsible for loss of investment opportunity

• The Pensions Ombudsman (TPO) determines that an independent trustee and administrator of a small self-administered pension scheme was not liable in respect of an alleged loss of investment opportunity.

Pension Schemes Bill: Ping Pong commences

On 15 April 2026, the House of Commons considered and rejected the non-government amendments to the Bill previously made by the House of Lords.

Outstanding issues will be considered by the Lords on 20 April. Once all remaining issues have been resolved, the final stage will be Royal Assent – when the Bill will become an Act.

Noteworthy Lords' amendments which were rejected by the Commons include the following.

Small pot consolidation: length of period for “dormancy”

• A Lords' amendment that an unused pension pot would only be classified as “dormant” for the purposes of the consolidation provisions if no contributions were made to the pot for three years.

The Commons reinstated one year as the period for determining whether a small pot is dormant.

For a reminder of the proposals for consolidation of small pots, please see our Briefing.

Defined contribution (DC) scale requirement

• A Lords' amendment to the scale requirement for Master Trusts and group personal pensions, so that the requirement would not apply if there was no reasonable evidence that consolidation would be likely to improve member outcomes; and
• The Lords' insertion of requirements for the Secretary of State, Financial Conduct Authority (FCA) and the Pensions Regulator (TPR) to have regard to innovation and design in pensions, and the benefits of competition, when making regulations concerning the scale requirement.

The Commons rejected these amendments.

DC asset allocation power for Master Trusts and group personal pensions

• The Lords' removal of the asset allocation condition, which would give the government a reserve power to mandate investment in particular asset classes (“qualifying assets”) by schemes subject to the DC scale requirements.

The Commons reinstated the power, but with additional restrictions on its use, so that regulations may only require:

• Up to 10% (by value) of the assets held in default funds in the scheme as a whole to be qualifying assets; or
• Up to 5% (by value) of the assets so held to be of a “UK-specific description” (as defined).

A qualifying asset will be of a “UK-specific description” if, broadly, it is located in the UK or meets any other condition linked to economic activity in the UK.

For more details of the scale and asset allocation requirements please see our Digest of 2 June 2025.

Return to Contents.

The Pension Protection Fund publishes its response to the government's consultation on the future of trusteeship

The Pension Protection Fund (PPF) has published its response to the government's consultation: Trust-based pension schemes: Trustees and governance, building a stronger future (summarised in our Digest of 18 December).

In its response, the PPF notes that trustees are facing "growing challenges in a complex world" covering not just pensions, but developments in other areas such as technology and financial services. It also notes that the complexity and impact of decisions will increase with the growth in scale of individual schemes. In light of this, the PPF believes it is important to consider how the "system" can be improved and suggests that it may be valuable to look to the approach taken in financial services.

The PPF's comments include:

• There should be clear, enforceable standards around how schemes and trustees declare and manage conflicts of interest. The government might wish to explore the rules to reduce and manage conflicts of interest set by the Financial Conduct Authority (FCA) for individuals at investment management firms, including information barriers and annual attestation.
• Drawing on experience of administering the Fraud Compensation Fund (FCF), there is a potential role for a public trustee. This could include where defined benefit (DB) schemes have been left with few trustees (for example, a business runs into difficulties, so the independent trustee is not paid, the employer trustees resign, and only the single lay trustee remains); and where a scheme has few assets and there is limited incentive for professional trustees to take on cases.
• Introducing a more structured framework, including templates and checklists, for small schemes might promote better governance, for example in managing conflicts of interest. It would assist trustees in understanding and fulfilling their legal duties and The Pensions Regulator's (TPR's) expectations.
• For a trustee board to work effectively, the board as a whole needs expertise across the full breadth of areas. Therefore, it is critical to focus on ensuring sufficient collective experience of the trustee board (rather than requiring all individuals to have the full range of skills and knowledge the scheme requires). Some of the principles that UK listed companies are required to follow might be worth exploring.
• It is important that trustee boards consider how to get a wider member "voice" to inform their decisions. Possible approaches include member surveys, having a dedicated consumer panel, and using data and complaints from scheme administrators and social media.
• There is merit in exploring minimum standards, particularly relating to data and risk management.

The consultation closed on 5 March 2026.

Return to Contents.

The Upper Tribunal set aside a First Tier Tribunal decision, having found that it had made an error of law in relation to the validity of electronic service.

On 20 February 2026, the Upper Tribunal (Administrative Appeals Chamber) issued its ruling in Pensions Regulator v Been London Design Ltd [2026].

Background

Been London Design Ltd (BLD) missed its deadline for making a redeclaration of compliance in relation to its auto-enrolment duties. The Pensions Regulator (TPR) posted a compliance reminder, followed by compliance notices, to BLD's registered office. TPR then posted a third compliance notice to a different address, from where BLD carried on its business.

When no action was taken, TPR posted a fixed penalty notice to the second address.

The second address was not registered with Companies House at the time of posting the third compliance notice, but was the registered address by the time the fixed penalty notice was issued.

BLD applied for a review, which TPR refused. BLD then appealed to the First Tier Tribunal, arguing that it had not received the third compliance notice. The First Tier Tribunal revoked the fixed penalty notice. The judge's reasoning relied in part on a belief that TPR had access to (but did not use) business e-mail addresses which could be used to prompt companies to comply. TPR appealed to the Upper Tribunal.

The Upper Tribunal decision

The Upper Tribunal noted that section 304(5)(a) of the Pensions Act 2004 permitted electronic service only where the recipient had consented to receive communications electronically. There was no evidence that BLD had consented to this. The First Tier Tribunal was therefore wrong in law to rely on electronic communication as an available option. The First Tier Tribunal decision was set aside and the case remitted for rehearing.

Return to Contents.

The Pensions Ombudsman determines that administrator was not responsible for loss of investment opportunity despite administrative failings

The Pensions Ombudsman (TPO) has determined that an independent trustee and administrator of a small self-administered scheme (SSAS) was not responsible for an alleged loss of investment opportunity.

Background

Mr M and Mr L were member-trustees of a SSAS sponsored by M&D Property Solutions Limited and Day Cooper Day (DCD) was the independent trustee and administrator. In 2018, Mr M's investment adviser provided Mr M with an investment portfolio proposal. At around the same time, Mr M and Mr L decided to appoint Empowered Pensions Limited (EP) as the new independent trustee and administrator of the SSAS.

There was a series of delays during the appointment process. EP acknowledged that it was responsible for certain administrative failings, including communication and processing failures, and a "failure to control the take-over process". EP refunded fees of £2,100 to the scheme.

Mr M rejected the refund as inadequate, claiming that the delays had prevented the investment of the scheme's cash holdings and had resulted in a loss of investment opportunity worth in excess of £10,000.

TPO's decision

TPO agreed that EP had been responsible for administrative failings during the process for transferring the scheme's administrative and trustee functions, but concluded that the failings did not prevent the investment of scheme funds or the giving of investment instructions.

TPO found that EP could not be responsible for any act/omission related to the scheme's investments which occurred before its appointment. Up until that point, DCD remained the independent trustee and, together with the member trustees (Mr M and Mr L), could take (and implement) investment decisions. It also operated the scheme bank account.

TPO also noted that investment instructions were ultimately given months after EP's appointment, further suggesting that the delays did not prevent the investments.

TPO noted that an award of £1,000 would have been appropriate, in respect of the "serious" distress and inconvenience Mr M had suffered as a result of EP's maladministration. However, as EP had already refunded fees of £2,100, which exceeded this amount, TPO did not uphold this aspect of Mr M's complaint.

Return to Contents.

Please click here to subscribe to our mailing list if you do not currently receive our digests directly to your mailbox.

Authored by Jill Clucas and Susanne Wilkins.