The Pensions and Lifetime Savings Association (PLSA) has published guidance to help defined contribution (DC) occupational pension scheme trustees and employers to provide increased support and options for savers over how they access their pensions.

The association noted that there is increasing attention and scrutiny on what pension schemes can and should do to support members in converting their pots into an adequate and sustainable income.

Its DC Scheme Guidance on Retirement Arrangements and Partnerships, published in partnership with LCP and Eversheds Sutherland, aims to help trustees and employers manage the legal, regulatory and commercial issues connected with partnerships with third parties to offer savers access to a range of decumulation options.

It also highlighted areas of focus for the government and regulators to make the partnership process simpler and more accessible.

The guidance called on the government and regulators to clarify the extent to which schemes can provide ‘nudges’ to members based on limited information about what people in similar situations do, and how support for savers would interact with the advice/guidance boundary.

Trustees also need greater clarity about what constitutes a ‘commercial benefit’ in the context of partnership arrangements, the PLSA stated.

The association argued that the statutory framework needed to outline when the trustee’s legal responsibility ends and provide a statutory discharge, subject to trustees’ implementing and reviewing the suitability of the retirement provision and partnership arrangement, for trustees to have confidence in where their liability sits.

The document also called for more guidance from the Department for Work and Pensions and The Pensions Regulator on the communications, guidance and risk warnings associated with decumulation solutions to establish how tailored schemes’ messages can and should be.

“In anticipation of a new duty being placed on pension trustees to offer greater support to members at retirement, this guide is intended to give trustees increased assurance and confidence in navigating the legal, regulatory and commercial aspects of providing decumulation guidance,” said PLSA senior policy lead, Ruari Grant.

“Trustees want to help savers make better choices about how they access their pension in retirement, but several barriers remain. It is vital that the government and regulators continue to engage with the pensions industry to ensure that the incoming legislation – and ongoing Financial Conduct Authority rules – meet the needs of schemes and savers.”

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