Expectations for DB pension transfers turnarounds under PASA guidance
4 August 2019
ATEB Consulting’s Steve Bailey looks at what paraplanners and administrators can expect in terms of efficient turnaround of DB pension transfers under the guidance published by PASA.
The Pensions Administration Standards Association (PASA) recently issued part one of its guidance on DB Transfers and relates to ‘standard’ or straightforward cases. Part two will cover ‘non-standard’ or complex cases and should be published towards the end of 2019. The guide can be read here.
It is aimed at Scheme Administrators and Trustees rather than advisers but should be of interest to advisers, paraplanners and administrators involved in DB Transfer advice so as to be aware of the standards that pensions schemes will, or should, be working to.
The stated intention of the guidance is threefold:
‘Standard’ cases… are those which meet these criteria:
… are defined below and will be covered in part two of the guidance:
Provide a CETV (no referral to actuary) – 7 working days
Provide a CETV (referral to actuary) – 8 working days
Settlement – 9 working days
These timescales are probably quicker than many members and advisers have experienced historically and will no doubt be welcomed. In practice, there are likely to be odd cases where these timescales are exceeded for one reason or another.
PASA has agreed a number of standard documents – letters to members, advisers etc. This is bound to help advisers who will be able to become familiar with what schemes send in place of the historical situation where every scheme is different.
Of particular interest is the creation of a standard ‘Transfer Template’. This can be seen at appendix 4 of the guidance. It comprises two separate documents and will present all the information and adviser needs in a standardised format:
There will be one document for each different applicable section of the scheme. Typical criteria which would define a section would include:
This document details all the member specific information.
Section 48 Declaration
This is the declaration that schemes are obliged to obtain as confirmation that members have received advice – mandatory for members whose safeguarded benefits exceed £30,000. It is worth emphasising that it is not the value of the benefits to be transferred that is considered in relation to the advice threshold – but the total value of safeguarded benefits under the scheme which could be less than the total CETV.
Some schemes have been fussy in the past and insisted on their own documentation but that should no longer be the case. PASA states:
“We recognise many scheme administrators have built a section 48 declaration into their own discharge paperwork, however it is the responsibility of the adviser to provide this and therefore schemes should be willing to accept a separate letter covering the information below.”
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