Pensions wealth

by | Dec 8, 2022 | Pension History

The value of pension rights only seeped into public consciousness towards the end of the last century. The personal finance columns of popular newspapers began to highlight the importance of pension rights as well as the family home. And because many women combine their working life with family responsibilities and men accumulate a disproportionate amount of pensions wealth, it was important that financial settlements on marriage breakdown found a way to recognise that reality. Taking effect on 1 December 2000, the Welfare Reform and Pensions Act 1999 introduced pensions sharing. This meant that a pension could be valued and split between the pension holder and ex-spouse. Subsequent legislation extended pension sharing to civil partnerships.

Before pension sharing became available the value of pension rights could be reflected in other ways. For example, a pension might be set off against other assets, or a percentage of pension income diverted.

Still, as the Association of Consulting Actuaries concluded in its 2001 Annual Review, pension sharing was likely to be of great assistance in dealing with the financial aspects of divorce. The Review noted in passing the ACA’s contribution to work of the DSS Advisory Panel, a welcome acknowledgement of the efforts of many industry professionals in seeking to improve technical pensions legislation. It also noted that actuarial advice might be needed to ensure that the courts were properly informed!

Jane Marshall (Director)

The Pensions Archive Trust

First published in Pensions Age magazine, December 2022 edition.