The Occupational Pension Schemes (Administration, Investment, Charges and Governance) (Amendment) Regulations (Northern Ireland) 2024

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations revoke and re-enact the Occupational Pension Schemes (Administration, Investment, Charges and Governance) (Amendment No. 2) Regulations (Northern Ireland) 2023 (“the Administration Regulations”) which would otherwise cease to have effect by virtue of section 51(3)(b) of the Pensions Act (Northern Ireland) 2015 (“the 2015 Act”). Like the Administration Regulations, the Regulations make amendments to the requirements relating to the administration and governance of occupational pension schemes.

Regulation 1 sets out when the new requirements will apply to schemes.

Regulation 2 amends the Occupational Pension Schemes (Scheme Administration) Regulations (Northern Ireland) 1997 to require trustees or managers of occupational money purchase schemes to report on specified performance-based fees incurred by the scheme and on the different classes of assets in which they invest in their annual chair’s statement.

Regulation 3 amends the Occupational Pension Schemes (Investment) Regulations (Northern Ireland) 2005 to require schemes to include an explanation of their policy about investing in illiquid assets in their default Statement of Investment Principles or, in the case of qualifying collective money purchase schemes, in their Statement of Investment Principles.

Regulation 4 amends the Occupational and Personal Pension Schemes (Disclosure of Information) Regulations (Northern Ireland) 2014 so that the new disclosures about specified performance-based fees and asset allocation, which will be required in the annual chair’s statement, are included within the list of disclosures that must be made publicly available free of charge on a website.

Regulation 5 amends the Occupational Pension Schemes (Charges and Governance) Regulations (Northern Ireland) 2015 to exclude specified performance-based fees from the charge cap that applies to limit the charges that can be passed on to members of most occupational money purchase pension schemes. It also removes provisions allowing schemes to smooth or pro-rate the effects of performance-based fees for the purposes of the charge cap, as these are no longer required when most performance-based fees will be excluded from the charge cap.

Regulation 6 revokes the Administration Regulations.

As these Regulations, in so far as they are made under the Pensions (Northern Ireland) Order 1995 (“the 1995 Order”) and the 2015 Act, make in relation to Northern Ireland only provision corresponding to provision contained in regulations made by the Secretary of State for Work and Pensions in relation to Great Britain, the requirement for consultation does not apply by virtue of Article 117(2)(e) of the 1995 Order and paragraph 8 of Schedule 18 to the 2015 Act.

An assessment of the cost to business of these Regulations is detailed in a Regulatory Impact Assessment which accompanied the Occupational Pension Schemes (Administration, Investment, Charges and Governance) (Amendment) Regulations (Northern Ireland) 2023 (S.R. 2023 No. 62), a copy of which was laid in the Business Office and the Library of the Northern Ireland Assembly. Copies of the Assessment are available from the Department for Communities, Social Security Policy, Legislation and Decision Making Services, Level 8, Causeway Exchange, 1-7 Bedford Street, Belfast BT2 7EG or from the website: https://www.communities-ni.gov.uk/articles/pension-information. A copy of the Assessment is also annexed to the Explanatory Memorandum which is available alongside this Statutory Rule on the website: http://www.legislation.gov.uk/nisr.