This week brought a flurry of significant updates across the pensions industry, with guidance and defined benefit (DB) funding developments taking centre stage.

The Pension Regulator (TPR) released updated covenant guidance for trustees of DB pension schemes, in alignment with its new DB Funding Code.

The Pension Protection Fund's (PPF) latest Purple Book also revealed that the net funding position for DB pension schemes has remained largely stable over the past year.

This also included restated figures for 2023, after the PPF, alongside TPR, amended their actuarial models to take account of benefit payments and future accrual, to create more alignment across DB funding models.

Further updates on DB funding emerged this week through the release of Broadstone’s Sirius Index and XPS Group DB UK Funding Watch.

Broadstone reported ‘marginal’ moves on DB scheme funding levels in November, while XPS Group found that DB pension surplus remained at record levels in the same period.

Shifting the focus to technological advancements, this week brought an update on the Pensions Dashboards Programme (PDP), confirming that two of its volunteer participants have completed integration testing, with wider industry connection "getting started next year".

The PDP also confirmed that a further six volunteer participants have started their connection journey, with all volunteer participants to be invited to connect by mid-December 2024.

Work to improve data has also continued, as the Pensions Administration Standards Association (PASA) launched guidance this week but on data scoring, with support from TPR, which is aimed at improving the consistency and quality of data in the pension industry.

In addition to this, the trustee of the Merchant Navy Ratings Pension Fund (MNRPF) agreed to a £450m longevity swap with Metropolitan Life Insurance Company, providing long-term protection to MNRPF against costs against the costs associated with pensioners and dependants living longer than expected, enhancing security for fund members.

The buy-in market also witnessed notable activity, with Hymans Robertson reporting a “record” number of buy-in transactions in the third quarter of 2024.

It is no surprise that this trend continues in the fourth quarter of 2024 with the KION Group completing a £250m full scheme buy-in with Canada Life and the Avimo Pension Scheme completing a £50m buy-in with Rothesay this week.

This week also saw news from the Bank of England which shared the results of its system-wide exploratory scenario exercise which revealed UK pension funds have "significantly" improved their resilience concerning liability-driven investment over the past two years.

In another positive development, 100,000 former mineworkers across the UK have received the first boost to their pensions, following the government’s decision, announced in the Autumn Budget, to reverse a “historic injustice” suffered by Mineworkers' Pension Scheme members.

Finally, HMRC research also found combined tax reliefs for pensions, including reliefs on contributions and tax-free investment growth, accounted for approximately £52bn in 2023/24.

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