Greetings – Mike here on TCWU duty while the boss is in Glasgow giving the venue for HomeGame5 a good recce. More of that later….

Back in the day before twitter became a bot driven hell site designed to spread misinformation and conflict, Pensions Twitter was a small piece of joy, quietly sitting in the corner bothering no-one but exploding into excitement whenever pensions hit the mainstream. With this week’s double whammy of the announcement of the Pensions Commission and the IHT on pension funds policy paper the excitement could well have been off the charts. Sadly, the analysis is now conducted elsewhere with a disappointing lack of memes and informed respectful discussion. The slow death of twitter (in its current guise/ownership) is a good thing, but I do miss it when we get a pension news agenda like we’ve had this week.

Anyway, onto the matter in hand, and first up, IHT. Over recent months there had been several attempts by various parties to lobby the Government into changes. Most of these seemed very sensible and well thought through, so predictably appear to have been ignored. It is pretty much as you were, save for a small tweak confirming personal representatives rather than pension scheme administrators will be liable for reporting and paying any IHT due.

As someone who has been there/done that over the last 18 months with the whole bereavement and IHT process the news that I might have to deal with some more pension providers hardly fills me with joy. The good news is that HMRC recognises this, and “will mitigate this impact by providing personal representatives, pension scheme administrators and beneficiaries with clear guidance, a calculator to advise whether Inheritance Tax is due, and a straightforward system to pay the tax liability”. Well, that’s all right then.

One of smartest brains from the Pension Twitter days, Andrew Tully, is quoted as saying ‘This complex process will cause bereaved families confusion and stress at a difficult time and doesn’t fit well with the support firms may want to provide people who are likely to be vulnerable following the death of a loved one”. Based on my recent experience I would agree, but being optimistic I hope providers will recognise this and between now and April 27 ensure the relevant support teams are recruited and trained accordingly, with effective systems beneath them to support customers through these difficult times. It could be very painful for all concerned if not.

I also wonder whether these changes will result in an increase in pension consolidation activities. The best gift you can give your executors and beneficiaries is reducing the number of providers they will have to contact?

And if that wasn’t enough excitement for one week, we also have the announcement of the Pensions Commission. Over recent years we have provided input to the Government’s work on financial services strategy and our first recommendation was the formation of a long-term savings commission. The key to the success of the last Pensions Commission was cross-party consensus, and it’s crucial that all political parties get behind this new Commission to create consistency and decision-making around long-term savings. Constant tinkering with the pension regime creates a huge overhead for providers and advisers alike, and it also risks reinforcing the perception of a sector that is increasingly impenetrable.

As both of these initiatives progress it is vital that there is a balanced and objective consultation process. You only need to look at the issues that emerged with DB transfers the last time that big changes were implemented into the pension sector without adequate input from trade and consumer bodies. Unlike normal twitter, most of the experts in what was Pensions Twitter are well worth paying attention to, and especially so as we move towards what are potentially significant changes impacting millions of families. I hope their concerns are listened to.
 
Mike