Solicitors' pensions protected
Pensions
February 17, 1999 at 07:03 PM
2 minute read
Leading pensions lawyers have welcomed new legislation that will protect solicitors' pensions if they go bankrupt.
The provisions are included in the Welfare Reform and Pensions Bill introduced into the House of Commons on 10 February.
The legislation follows intense lobbying by a number of groups representing the self-employed, including solicitors.
It aims to remedy the current anomaly in the treatment of those with occupational pensions schemes and those with personal pension schemes on bankruptcy.
Under the existing law, personal pension schemes vest in the 'trustee in bankruptcy' on his appointment. The pension remains vested in the trustee after discharge, which means that he is indefinitely entitled to the benefits under the scheme.
Occupational pension schemes, however, can be protected on bankruptcy if appropriate provisions are included within the scheme.
The new Welfare Reform and Pensions Bill will extend this
protection to personal pension schemes.
Ian Greenstreet, a pensions lawyer at Simmons & Simmons who played a key role in lobbying the Government, said: "Solicitors' pensions will be safer once the new provisions are brought into force.
"The existing legal position is patently unfair. Why should partners and other self-employed professionals be penalised just because they have no choice about their pensions scheme? If you are self employed you cannot join an occupational pension scheme."
Philip Bennett, leading pensions lawyer at Slaughter and May said: "[The new proposals are] a significant development. Under the current law there is an unfair prejudice against the self-employed.
"There is an anomaly in the situation which should be resolved".
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