We are writing in relation to your clients Group Defined Contribution (DC) Pension Schemes with Zurich Life.
This is particularly relevant in cases where the Employer is acting as the trustee of their pension scheme.
In our previous letters and emails we advised you of the new IORP II pension requirements which are regulated and monitored by the Irish Pensions Authority, and which can be summarised as follows:
- Trustees have increased duties and responsibilities
- Trustees must meet the ’fit and proper’ standards of IORP II
- Trustees must appoint Key Function Holders for Risk and Internal Audit
- Trustee must arrange for full audited accounts to be produced for the scheme year (including the cost of audit) for ALL schemes regardless of membership
- Declaration of Annual Compliance Statement
The additional costs of the above can easily be avoided by moving your clients Group DC Pension Scheme into a Master Trust. The Pensions Authority have confirmed they will not impose the requirement for Audited Accounts in 2023 if the pension scheme trustees have given a Formal Commitment before 31 December 2022 to wind up their pension scheme and transfer the assets to a Master Trust by 31 December 2023.
Formal Commitment made to Wind-up Pension Scheme and transfer to a Master Trust
As stated above (and in our previous correspondence), the most cost-effective way to achieve compliance is by moving your clients current pension scheme into a new Master Trust pension arrangement.
To date we do not appear to have received a copy of the Formal Commitment Form from some of your clients.
If your clients intend to move to our Zurich Master Trust and want to avoid the cost of annual audit fees then we need this Formal Commitment Form to be returned to us as soon as possible, showing that the pension trustee made a Formal Commitment to Wind-up the pension scheme before the 31 December 2022 deadline set by the Pensions Authority.
A signed copy of your clients Formal Commitment should be emailed to MasterTrust@zurich.com
Zurich will facilitate this process and will schedule your clients transition during 2023.
Clients who have decided NOT to Wind-up their Scheme
If your clients have decided NOT to make a Formal Commitment to Wind-up their pension scheme and move it into a Master Trust then the trustees of the pension scheme must ensure that their scheme complies with the new IORP II pension regulations.