The majority of defined benefit (DB) pension schemes say it is "still too early to say" whether the use of surplus proposals will affect their strategy, according to a poll carried out by LCP.

The government announced plans in January to lift restrictions on how well-funded occupational DB pension schemes were able to use surplus funds, potentially unlocking billions.

While the poll suggested DB schemes are interested in exploring how these changes could benefit them, only 20 per cent said they were currently able to predict that the changes could represent “a significant development” for their strategy.

However, the majority (57 per cent) said that it was “too early to say” whether the changes would affect their strategy.

The figures suggest that schemes are taking time to work through the implications of recent changes and to digest the information produced on the topic.

This includes a response to the Department for Work and Pensions (DWP) consultation on DB options, guidance to the new endgame proposals from The Pensions Regulator (TPR) and the publication of the Pension Schemes Bill.

LCP head of trustee consulting, Jill Ampleford, commented: “The raft of recent publications will take some time to digest, but has fired the starting gun for trustees to consider what this means for their scheme and its members to best prepare for when the new laws are in place.”

She added: “The new powers put trustees in a crucial position, having the ability to initiate a change in scheme rules if they are a potential barrier to a preferred strategy as well as having ultimate sign-off on any approach.”

Meanwhile, LCP’s head of corporate consulting, Gordon Watchorn, said: “The DWP and TPR are creating an environment which enables sponsors to consider a broader range of options, and the right solution will depend on the circumstances of each case.”

But working through the options sooner rather than later is essential, Watchorn added: “Companies who engage early and constructively with their trustees will have the best chance of reaching a positive solution.”

---