Plumbing & Mechanical Services (UK) Industry Pension Scheme (PMSIPS) – possible twist in the tail for section 75 and industry-wide pension schemes
Of note for employers participating in industry-wide schemes, the PMSIPS has attracted wide discussion over the past year or so in relation to “section 75 debts”. It seems that the PMSIPS’ trustees have not pursued departing employers for these debts, leaving “orphan” liabilities in the PMSIPS which fall to be allocated to remaining employers under the rules of this “last man standing” scheme. The useful development for employers in other schemes is the announcement of an independent governance review of the PMSIPS’ trustee board and an investigation into its approach to section 75 and wider matters concerning its management of the PMSIPS.
Of particular note is the broad point that the case has highlighted, that the section 75 regime does not adequately take account of small employers, which may have different legal structures from typical DB scheme sponsors, and the fact that easements available to deal with employer debt may not be suitable for non-associated employers in industry-wide schemes.
Watch this space as we report on any further developments!