A ‘No’ vote in the EU Referendum has many complexities for pension schemes, but would remove the risk of any EU imposed balance sheet or further interrogation of EU laws for pensions, PTL has said.

Industry figures have been vocal about the burdens that a HBS could pose, noting how it will increase workload for trustees and provide a number of challenges.

Following the pensions stress test, PensionsEurope claimed the HBS “does not work” and EIOPA should instead propose principles-based guidelines only, which can then be considered and adopted where appropriate by national competent authorities of the relevant countries.

However, PTL client director Colin Richardson said one good thing to come out of a Brexit would be that the threat posed by a HBS would be eliminated.

“By far the most positive outcome would be the falling away of the risk of an EU imposed holistic balance sheet, which, if put in place would be the final blow for DB pensions,” Richardson said.

Despite this, he said it still “goes without saying” that cross-border EU schemes would “be in jeporardy”.

“In terms of pensions law, while the UK would be unlikely to reverse the sex, age, disability or other discrimination or human rights impacts stemming from the EU, it is possible that the UK may be able to permit sex specific annuity rates,” he said.

“A ‘Yes’ vote would likely see a potential ‘relief rally’ on the markets, although the impact overall would be limited at the outset. All pre-existing EU law would be fixed, and it would seem unlikely that any pensions directive would be a measure for the UK to trigger the new veto if more than 50 per cent of states reject a measure,” he added.

“Therefore, directives on holistic balance sheets and qualifications for trustees would more than likely come through over time. In terms of what trustees need to do ahead of the Referendum? Not a lot right now, just watch and wait.”

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