Reference Scheme Test

Triumph13

I was wondering if anyone had any experience of the following situation as it impacts transferring a pension.
My employer used to operate a DC scheme which, in order to qualify for the contracting out rebate, included a 'Reference Scheme Test' whereby if the DC funds were worth less than the value of the reference scheme annuity then you would get the reference scheme instead.
With the 'safeguarding' rules that now exist I feared that this would get caught and I would have to pay an arm and a leg to an IFA pension transfer specialist before I could transfer. I have checked with the administrators though and been told that there is ONLY a requirement to get advice if the reference scheme is triggered ie if the DC funds are more than the transfer value of the reference scheme then it counts as pure DC. If true this is great news - the DC is about 50x the RS pension and so it shouldn't be triggered - but as a natural pessimist I don't want to bank on that without more confirmation. Mr Google came up blank so I wondered if anyone has experience of something similar?

Dox

You need to take advice before attempting to transfer from a scheme where there are safeguarded benefits (and the transfer value is £30,000 or more) to satisfy the scheme from which you are transferring. If the administrators of the scheme have confirmed that the scheme does not have safeguarded benefits (it sounds as if they have confirmed that's the case - and they should know), your quest should end there.

It will be a DC to DC transfer, so there should(!) be no issue in getting your choice of receiving scheme to accept the transfer.

xylophone

DC with DB underpin?

http://www.mycompanypension.co.uk/What-is-a-Money-Purchase-Scheme-with-a-Defined-Benefit-Underpin-Pensioner-Members-DB

Might be best to check on safeguarded benefit position?

Triumph13

Thanks Xylophone. That website seems to be down, but trying to get to it led me to the following from DWP:
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/370862/money-purchase-benefits-guidance.pdf

This seems to confirm that the administrators are indeed right:

The existence of a promise (or guarantee) to a defined benefit minimum in relation to money purchase underpin benefits does not prevent a benefit which otherwise qualifies as a money purchase benefit from being a money purchase benefit. This is as long as the value of that money purchase underpin benefit is equal or greater than the defined benefit minimum at the relevant date.

It still strikes me as a little illogical, but I'm certainly not complaining!