The Association of Consulting Actuaries is in discussion with the Department for Work and Pensions about how to mitigate the impact of the Virgin Media v NTL Pension Trustees II ruling. It hopes to have an update in the new year. 

The ACA has sent an update about the Virgin Media case to its members and to the members of the Association of Pension Lawyers and the Society of Pension Professionals. 

A working group representing the three industry organisations has been providing information to the DWP “to help the department understand the adverse impact on industry of this ruling”, and has been exploring what form any intervention could take.  

The Court of Appeal judgment in Virgin Media this year invalidates amendments of contracted-out schemes that cannot produce written actuarial confirmation that they have met the scheme reference test. For affected schemes this could mean complicated rectification exercises and potentially higher liabilities.

The DWP has the power to help schemes by retrospectively validating amendments, but it has not done so to date, despite intense lobbying by the pensions industry.

“The working group continues to believe that the secretary of state should make regulations that would, subject to appropriate safeguards, enable the validation retrospectively of any amendment that is held to be void solely because either a written actuarial confirmation was not received before the amendment was made, or where such a confirmation cannot now be located,” the ACA told members.

It added: “Quite what form such regulations could take, if a regulatory approach is agreed, is a matter that the working group is discussing with the Department, with the working group refining its thinking as a result. We hope that an update can be provided in the New Year.”