The Occupational Pension Schemes (Member-nominated Trustees and Directors) Regulations 2006 (SI 2006/714) have been laid today and come into force on 6 April 2006. They concern the application of ss.241 - 242 of the Pensions Act 2004. Together with the provisions of the Act, these new regs (which revoke the notoriously convoluted 1996 Regs) provide some genuine simplification of pensions legislation.

The original list of exempted schemes in the draft version of the regs on which the DWP consulted last summer has been widened to include "small insured schemes", defined as schemes with fewer than twelve members and where all the benefits are insured. Schemes which are independent of the employer because the employer ceased to exist prior to 6 April 2005 are also exempted.

The nomination of MNTs to schemes comprised entirely of deferred members is now possible: Reg 5(6) allows trustees to decide which of them may join in the process of nomination. Existing employer opt-outs cease on the date they would have ceased but for the revocation of the 1996 Regs or 31 October 2007, whichever is the earlier. Few other changes have been made from the draft regs. Although discussed in last year's condoc, no reference is made in the final regs to the proposed move in future to 50% MNTs. We await the final version of TPR's Code of Practice to see what approach will be taken where trustees fail to attract a sufficient proportion of MNTs.

Also laid today, The Occupational Pension Schemes (Trustees' Knowledge and Understanding) Regulations 2006 (SI 2006/686) relate to the statutory requirements in ss.247 - 248 of the Pensions Act 2004 setting out what trustees are expected to know and understand. Individual trustees of "small schemes" (defined on a similar basis to SSASs) are exempted from these requirements. Corporate Trustees of such schemes are also exempted in cases where the members are directors of the Trustee company. Individual trustees and persons who exercise functions of a corporate trustee are formally granted a six-month period of grace, from the date of their appointment, in which to come up to scratch (qualified independent trustees or those appointed as having relevant expertise are excepted). The regs come into force on 6 April 2006. They are silent on whether trustees already in post for six months or more on that date are immediately liable to sanction for lack of the requisite knowledge and understanding. For that, we must look to the Code of Practice (current version still in draft) to be published by The Pensions Regulator (TPR).

Most of TPR's codes of practice, though relevant to legislation in force from 6 April 2006, have yet to emerge from the consultation draft stage and are not expected to be finally issued until May or June. A development schedule [PDF] sets out TPR's plans.

A positive advance this week has been the laying before Parliament of the "Early leavers - reasonable periods" code of practice. Technically still a draft, the code relates to The Occupational Pension Schemes (Early Leavers: Cash Transfer Sums and Contribution Refunds) Regulations 2006 (SI 2006/33) and the new rights of members leaving occupational pension schemes from 6 April 2006 after three months and with less than two years pensionable service, and without vested rights to benefit under the scheme rules, to take a cash transfer sum or a refund of their contributions. Trustees must, within reasonable periods, notify the members of their rights and how they can exercise them, and give effect to the member's chosen option. The Code sets out TPR's view as to what constitutes a reasonable time period.

The Pension Protection Fund (Risk-based Pension Protection Levy) Regulations 2006 (SI 2006/672) is a short set of regs essentially providing that, when assessing the amount of the risk-based pension protection levy payable by an eligible scheme in accordance with s.175 PA 2004, the Board may take into account the nature of, and any risks associated with, any arrangements which may reduce the risk of compensation being payable from the PPF in the event of an insolvency event occurring in respect of an employer in relation to the scheme. Although published only today, this SI came into force on 9 March, being the day after it was Made.

The Guaranteed Minimum Pensions Increase Order 2006 (SI 2006/673) specifies 2.7 per cent. as the percentage by which that part of any guaranteed minimum pension attributable to earnings factors for the tax years 1988-89 to 1996–97 and payable by contracted-out, defined benefit occupational pension schemes is to be increased. Under section 109(3) of the Pension Schemes Act 1993 the percentage to be specified is the actual percentage increase in the general level of prices in the period under review or 3 per cent, whichever is less. In force from 6 April 2006.

The Social Security Benefits Up-rating Order 2006 (SI 2006/645) [PDF], also published today, is the annual Order specifying the increase in various State social security benefits and pensions.