Options for Defined Benefit Schemes
- Life & Pension Systems
- Jun 11
- 2 min read
The UK Government’s response to the consultation for Defined Benefit (DB) Schemes to access surplus funds has confirmed a new framework, without the need to wind-up.
This shift allows trustees and sponsors to:
Make more informed decisions on using surplus funds to support members or employer obligations
Provide discretionary benefits or reduce future contribution requirements
Keep schemes running efficiently while maintaining robust protection for member benefits
Surplus Funds: What’s Changing?
Lower funding threshold for surplus extraction: schemes no longer need to reach full buyout funding level
The override gives trustees the power to amend scheme rules and extract surplus — with employer agreement — offering a more flexible framework for surplus sharing.
No 100% PPF underpin – but clear safeguards in place to ensure security of member benefits
What Trustees & Sponsors Should Do Next
Schemes should review funding positions, governance frameworks and processes to ensure surplus funds can be accessed and used appropriately under these new rules.
How Life & Pension Systems Can Help
We offer flexible administration systems designed to support these changes for DB schemes of all sizes. Our solutions:
Provide a centralised platform for member data, scheme funding records and audit trails
Include Workflow Master for clear oversight of tasks and governance
Are already pensions dashboard ready, supporting ISP integration so schemes can meet the upcoming dashboard deadlines without costly, bespoke IT builds
For smaller DB schemes, our minimal package offers an affordable way to:
Meet dashboard and ISP requirements
Access robust admin tools that ensure data accuracy and compliance
Reduce reliance on manual spreadsheets and streamline processes
This is a pivotal moment for DB schemes — let’s ensure your scheme is ready to unlock these new opportunities.
Interested in how your scheme can benefit from these changes? Let’s connect.
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