Pensions updates | June 2025

Virgin Media Decision

In a statement issued on 5 June 2025, the government has confirmed that it will introduce legislation to address the implications arising from last year’s Court of Appeal judgment in the Virgin Media v. NTL Pension Trustees case.  In that case the Court of Appeal held that any amendments to benefits of a contracted-out scheme made during 1997 and 2016 will be void, unless the scheme actuary provided the required actuarial confirmation (typically through what is commonly referred to as a “s.37 certificate”) that the pension scheme would continue to satisfy the statutory standard for contracted-out schemes (the contracting-out test). This has caused considerable concern for schemes where this did not exist or could not be located.  Further detail of how this will operate in practice is awaited.  

Pensions Schemes Bill

Pension scheme trustees have been urged by the Pensions Regulator to take proactive steps in anticipation of the Pension Schemes Bill, highlighting the need to maintain high-quality governance and services. Speaking at a pensions industry Defined Contribution conference, the Pensions Regulator's Interim Director of Policy and Public Affairs, Patrick Coyne, outlined four key themes from the Bill that trustees should begin addressing now:

• focusing on saver outcomes by reviewing investment strategies and advisor input;

• building scale by evaluating value propositions and considering consolidation or new investment opportunities like long-term asset funds (LTAFs);

• becoming data-led and accountable by investing in digital infrastructure and engaging with administrators ahead of pensions dashboards; and

• innovating at retirement by initiating board-level discussions on decumulation products and seeking early guidance from TPR’s innovation support services.

The Pensions Regulator emphasised that these are essential preparatory steps to ensure schemes remain fit for purpose under the new regulatory framework and encouraged trustees to act now to align with its direction.

On 5 June 2025 the government published the long-awaited Pension Schemes Bill, which broadly aims to support working people plan for their retirement by making pensions simpler to understand, easier to manage, and drive better value over the long term.  Alongside the Bill, the government published a roadmap for workplace pensions which reiterates that the reforms are designed to build a pension system that goes beyond merely accumulating savings by providing better governance, lower costs, and enhanced investment strategies.

The Pensions Scheme Bill is a significant piece of new legislation that affects employers and trustees of both defined benefit and defined contribution pension schemes.

Some key features of the Pensions Schemes Bill for defined benefits schemes include:

• establishment of defined benefit superfunds statutory regime for the authorisation and ongoing supervision of defined benefit superfunds;

• giving the Pensions Ombusdman the authority to determine and resolve disputes regarding "recoupment" (repayment via deductions from future payments) disputes without the further need for Court approval;

• flexibility for PPF levies including low and even zero levy rates; and

• surplus extraction flexibilities.

Assisted dying – Does it affect employers?

Both employers and trustees of pensions and life assurance schemes need to take great care when dealing with death benefits following the landmark vote to proceed with legalised assisted dying under the Terminal Ill Adults (End of Life) Bill.  If businesses get it wrong there could be severe consequences and its strongly advised that legal advice is sought.  Key considerations include:

• Trustee Decision Making – when making their decisions regarding death benefits trustees must make reasonable enquiries which will include the sensitive subject of the circumstances of a death, including specifically asking about terminal illness and any indication of assisted dying and should take legal advice to ensure that they are asking the right questions, undertaking the correct due diligence and considering the appropriate pieces of information in their decision making processes, including

• Criminal and civil liability in grey areas that are not yet defined in the Bill

• Equality Act 2010 considerations

• Forfeiture Act compliance which prevents a beneficiary from benefitting if they unlawfully killed the deceased, such as assisting in their death outside of the scope of the protections in the Bill but there will need to a full assessment of their involvement in a decision which benefits them financially, which will be a complicated task for employers and trustees to navigate.

• Documentation Changes – trust deed and policy documents may need to be re-drafted to take account of the new laws as they are confirmed, forms and processes may require updating, training may be required.

 Please do get in touch with the pensions team for any support and further information.