The Department for Work and Pensions (DWP) has published a new consultation aimed at punishing employers who jeopardise workplace pension schemes.
The news will be welcome to those with fears that their pension could go the same way as other less fortunate schemes in recent years, including the likes of BHS and Carillion.
Around 19,000 members of the BHS pension scheme, including 7,000 retirees, were facing cuts of at least 10 per cent until the defunct retailer’s former owner, Sir Philip Green, stepped in with a hefty contribution.
The Minister for Pensions and Financial Inclusion, Guy Opperman, said the new ‘punishments’ could include unlimited fines or a prison sentence for wilful or reckless behaviour that could harm the security of a pension scheme.
The consultation itself sets out proposals to improve the Pensions Regulator’s powers so that they can be “more proactive and get involved earlier when employers make changes which could affect the pension scheme”, as well as to get redress for members if things go wrong.
Mr Opperman said: “The Government’s position on defined benefit pensions is clear: Where an employer can, they must continue to meet their responsibilities.
“Millions of people across the country rely on defined benefit pension schemes to support them during their retirement.
“That’s why we are committed to introducing a range of new measures which support the Pensions Regulator to be clearer, quicker and tougher.
“This is an opportunity to strengthen defined benefit pensions’ protection for the long term, and it is extremely important we get the changes right.”
The consultation runs until 21 August 2018.