The following is a letter and submission sent to the DWP Scheme Funding Team who are looking at new rules for funding and investment strategies for Pension Schemes.

“Dear Scheme Funding Team,

This submission to your consultation is from the Hewlett Packard Pension Association (HPPA) Steering Group, of which I am a member.

Synopsis

The Pension Schemes Act 2021 introduces a new requirement for defined benefit pension schemes to have a funding and investment strategy for the purpose of ensuring that pension and other benefits under the scheme can be paid over the long term.

We interpret “other benefits” to also mean discretionary benefits.

Therefore – we also interpret this requirement to mean that scheme Trustees and sponsor company are expected to work collaboratively in developing and agreeing ethical policy and a supporting funding and investment strategy that facilitates and enables the granting of discretionary benefits.

Unfortunately – not all schemes have established such a collaborative approach and this has resulted in significant and repeated negative outcomes for many pensioners – especially those pensioners with pre’97 service.

Within our own scheme, many ex-Digital and HP employees have suffered significant financial loss and hardship due to the lack of discretionary increases over the past 20 years as current legislation does not disallow this.

We believe the proposed legislation should be enhanced with an “Ethical Code of Practice” and there is clear and obvious evidence to justify the need for this.

Our submission to this Consultation

Our submission below provides background and context to the circumstances and experience of pre’97 pensioners within the Digital Section of the HP Retirements Benefit Plan including analysis of TPR DB Landscape data and puts forward what we consider compelling evidence and justification for the DWP and TPR to establish an “Ethical Code of Practice”.We believe such a code is critical to enabling the DWP and TPR to provide greater clarity of expectations to Trustees and sponsor company executives on what is considered “good ethical practice” for UK Citizens.
We also believe many Scheme Trustees would support such a code of practice including any interventions by the DWP and TPR that promoted, facilitated and enabled greater collaboration between Trustees and company executives.
We look forward to hearing from you.

Kind Regards,

David Carson on behalf of the HPPA”