The Institute for Family Business (‘IFB’) has just published their response to The Pensions Regulator Defined Benefit Funding Code of Practice Consultation and as Jon Sharp, Director at Western Pension Solutions (‘WPS’) explains, “We are pleased to have been able to support the Institute for Family Business in their response to the important consultation on defined benefit pension scheme funding. In a nutshell we feel that change is needed for it to be appropriate for family businesses.”
In summary, the key points in the response are:
- Family businesses, with their long-term outlook and strong values, are committed to acting responsibly, but also recognise that investment and growth is essential if they are to be sustainable.
- Any future funding rules must always meet the Pensions Regulator’s (TPR) stated objective to “minimise any adverse impact on the sustainable growth of an employer.”
- A lack of flexibility in funding arrangements has previously led to businesses failing – it is essential that this does not happen in the future. It’s also important to recognise that inflexible funding arrangements will take cash away from businesses, which will impact on their ability to retain employees and invest in the business.
- In principle we can see benefits in a twin track compliance approach. Any Fast Track must be sufficiently inclusive to be able to include a large number of family businesses, particularly smaller businesses.
To see the full response to the consultation please visit the IFB website here
