James Bingham: The focus now turns to implementation
Schemes are already gearing up to make use of the Virgin Media remedy following its inclusion in the Pension Schemes Act 2026, a survey by Sackers finds.
The government introduced legislation as part of the Pension Schemes Act to give schemes affected by the Court of Appeal's ruling in Virgin Media v NTL Pension Trustees, handed down in July 2024, the ability to retrospectively obtain written actuarial confirmation that historic benefit changes met the necessary standards.
Sackers said polling conducted among 78 attendees at a recent webinar found that 33% of schemes now consider themselves "highly likely" to make use of the remedy, while a further 37% said they believe it is possible and are investigating further.
Of those expecting to proceed, 5% plan to begin immediately and 37% anticipate doing so within the first year.
Sackers partner James Bingham said: "The introduction of the Virgin Media remedy is a very welcome and pragmatic step forward for the industry. Over recent years it has been a central topic of discussion, with some schemes and advisers investing significant time and resource into understanding their positions. The arrival of a legislative fix is a welcome development which trustees will hope draws a line under this as an issue.
"We are pleased that the legislation provides a practical and relatively straightforward route forward. The gateway principles are clear and workable, giving schemes greater certainty around the process and next steps."
Bingham continued: "The focus now turns to implementation. Schemes will need to consider the availability and quality of historic member data, which is not always immediately accessible and can take time to retrieve. There may also be actuarial and evidential challenges, and some actuaries may want to take advice on the steps they are being asked to take.
"While the remedy provides a clear route forward for those that can use it, it's important to be realistic about the work involved and the time it may take to complete."
Bingham concluded: "Schemes will need to ensure they follow the required actuarial procedure and maintain clear documentation. Done properly, this should help bring long-awaited clarity on affected amendments and enable continued administration of benefits in line with current practice."
The Virgin Media case had potentially adverse consequences for defined benefit schemes that were contracted out of the state pension scheme at any time between 1997 and 2016.
The courts found that where schemes had not obtained the required Section 37 actuarial confirmation when making certain rule changes, those amendments could be invalid. This created significant uncertainty across the pensions industry, prompting many schemes to review historic documentation, benefit changes and governance processes amid concerns over potential liabilities and operational impacts.
The government has acknowledged that schemes and employers need clarity on this matter and, in June last year, said it would introduce legislation as part of the Pension Schemes Bill to give affected pension schemes the ability to retrospectively obtain written actuarial confirmation that historic benefit changes met the necessary standards.
In January, the Financial Reporting Council (FRC) provided guidance to actuaries on how to undertake this remediation work in a proportionate and pragmatic manner.
In March, The Pensions Regulator (TPR) published its guidance on section 37 issues arising from the Virgin Media v NTL Pension Trustees judgment.
The guidance – Potential remediation for past alterations to salary-related contracted-out pension schemes – sets out the watchdog's compliance standards and provides trustees with practical tips on areas such as whether or not to use the potential remediation available.
