The Pension Schemes Bill 2017, which legislates for greater protections around master trusts, has received Royal Assent.
This is the final stage of the bill going through Parliament and becoming an Act, making it law.
The Pension Schemes Bill increases protection for members of master trusts, which includes granting The Pensions Regulator (TPR) greater powers of intervention and requiring schemes to be authorised.
Master trust schemes will have to meet key criteria, such as ensuring that the parties involved in the scheme are fit and proper, that the scheme is financially sustainable, and that the administration and governance processes are sufficient.
The Pensions Schemes Bill also makes way for changes to legislation relating to pension administration charges. The government aims to prevent savers looking to withdraw their pension early through the pension freedoms from being penalised by early exit charges.
Nathan Long, senior pension analyst at Hargreaves Lansdown, said: “Members of certain workplace pensions like group personal pensions or group [self-invested personal pensions] already benefit from rules to protect them. The rubber stamping of this legislation is a solid step forward in bringing master trusts and other occupational schemes more in line. Nobody should be less well protected simply because of the pension chosen by their employer.”