In the run-up to the Parliamentary summer recess the Government's attention focussed as usual on a scramble to get Royal Assent to a shoal of Bills. Foremost for the pensions industry was the

Finance Act 2008, which received Royal Assent on 21 July together with the National Insurance Contributions Act 2008.

The latter is quite a short piece of primary legislation which with effect from tax year 2009/10 (to be the introduction year for the S2P flat rate),

1. severs the link between the UEL and the primary threshold, currently the point at which NICs start to be payable (meaning that from 6 April 2009, the Government can set the UEL - the point above which employees pay 1% NICs instead of 11%, or 9.4% if contracted-out - at any level they can get Parliament to accept); and
2. freezes the upper accrual point at £770 (= the UEL for 2008/09), instead of linking to the UEL for 2009/10 (meaning that from 6 April 2009, earners will cease to accrue S2P above £40,040 pa (52 x £770).

Pensions provisions in the Finance Bill passed through Parliament unamended. The relevant material is in Part 4, ss. 90 - 92, with Schedule 28 (Inheritance of tax-relieved pension savings) and more particularly Schedule 29 (Further provision about pension schemes) providing the detail.