Partner Rosalind Connor comments in Pensions Expert on the possible changes to the Corporate Insolvency and Governance Bill following concerns from pensions industry bodies
Pensions industry bodies are lobbying the government to make changes to the Corporate Insolvency and Governance Bill, which unless revised will “inevitably lead to more pensioners not receiving their benefits in full and greater strain on the Pension Protection Fund”.
’This warning comes from the Society of Pension Professionals, which set out its “serious concerns” over the current drafting of the legislation in a letter to the Department for Work and Pensions, seen by Pensions Expert.
The Department for Business, Energy and Industrial Strategy introduced the bill in parliament on May 20, aiming to relieve the burden on businesses during the coronavirus outbreak and allow them to focus all their efforts on continuing to operate.
The bill has also come in for criticism in the House of Lords, where peers across the political divide have questioned the impact on pensioner security.
Rosalind Connor commented:
“The government really wants to do this. People around the [insolvency] industry are quite supportive, and they need to do it quite quickly, due to the current market situation. If the bill changes as a result [of amendments introduced in the Lords], then it will need to go back to the House of Commons. There is a push against this from the government as they want it to be done on time.”
Rosalind also warned trustees to be prepared for the court cases if the legislation goes ahead.
“Creditors get to have their say in a court process, and it is really important that trustees are geared up very quickly to start looking at this and start presenting their case. In general, trustees have had the advantage that if something happened, such as a company voluntary arrangement, the PPF sits in the trustees’ shoes in those meetings. It looks like this isn’t the effect of the new legislation, which means that it will be up to the trustees themselves to argue their position.”
Read Rosalind’s comments in Pension
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