PLSA calls for a Brexit that works for UK pensions

The Pensions and Lifetime Savings Association (PLSA) has called for a form of Brexit that works well for pension funds in the UK.

The PLSA said that a successful outcome from the Brexit negotiations, from a pension scheme perspective, would include the following: a robust economy, the right regulatory system and a strong financial services sector. On the economy, the PLSA said it welcomed a transitional regime, as this would help avoid an economic cliff-edge. On regulation, it said that it is important that UK-only pension schemes, which do not operate on a cross-border basis, are exempted from any future EU regulation on a solvency based regime for pension funds. On the financial services sector, the PLSA said it is important that UK firms can continue to benefit from access to the EU single market through “passporting”.

PLSA director of external affair Graham Vidler commented: “A successful Brexit matters to the 20 million workers, savers and pensioners served by our pension schemes. If the economy weakens, it will make it harder for sponsoring employers to keep DB schemes open and reduce the funds individuals can afford to put into DC pensions – but these risks can be reduced if the government addresses the points we raise.” Vidler added: “We welcome Theresa May’s commitment to set up transitional arrangements to reduce any economic disruption due to leaving the single market. While it is not yet clear whether EU regulation, as a result of establishing equivalent rules for financial services, will encompass pension funds, we will be arguing strongly that EU rules on solvency requirements for DB pension funds should not apply to pension funds that only operate within the UK.”