The end of contracting-out : Employers must act now to understand costs and options

With all the excitement and press coverage around the recent Budget changes to DC pensions, the ending of contracting-out for DB schemes in April 2016 may seem a long way away.  However, for those employers who wish to make changes to their schemes to mitigate potentially significant increases in National Insurance costs, and to understand the impact of other less obvious consequences of this change, planning must start now.  In addition, those employers who are currently or about to engage with Trustees around Scheme Funding valuations will find it much more efficient to include the impact of the end of contracting-out in these discussions.

In this Pensions Focus we look at the implications of the abolition of contracting out for employers, in terms of costs, administrative issues and potential impact on scheme benefits, as well as the options available to employers to mitigate these.

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