Transfers from Defined Benefit (DB) pension schemes to Defined Contribution (DC) arrangements have always been controversial since the great pensions mis-selling scandals of the 1980s.Trustees will have needed to review their transfer procedures in 2015 and need to ensure they consider all the relevant factors. The merits of transferring are highly individual and the role of member advice is paramount.
All other things unchanged, the DC freedoms mean that for a given level of DB transfer, the proportion of members who may find the transfer attractive, or be advised to take a transfer, will have risen. Perhaps the rise is quite small and is a rise from a very low proportion to not quite so low a proportion, certainly in terms of cases where an IFA is able to advise a member to proceed with a transfer.
“DB to DC Transfers: The Trustee position” was written by Colin Richardson