Queen’s Speech: pensions, employment and airline insolvency changes

Changes to the financial services regime to prepare for Brexit, new airline insolvency rules, and a ‘pensions dashboard’ for savers were among the measures in the Queen’s Speech outlining the government’s programme for the year ahead

The speech also contained an outline of the European Union (Withdrawal Agreement) Bill. This the legal mechanism by which the UK can leave the EU with a deal on 31 October 2019, and would need to pass through Parliament by the agreed deadline.  The bill will include provisions on a transition period for business to prepare, any protocols for Ireland and Northern Ireland and the rights of EU citizens, but the specific details depend on the outcome of negotiations.

There were 26 bills in total, but with Brexit negotiations still in a state of flux, it is unclear whether any of the proposed legislation will be laid before Parliament until the EU withdrawal agreement has been decided. As the government does not have a working majority, this also makes it unlikely many of the bills will pass into law in the current Parliament.

Financial services

The speech announced steps to ‘provide certainty, stability and new opportunities for the financial services and legal sectors’.  The financial services bill includes measures to simplify the process which allows overseas investment funds to be sold in the UK. The government also pledged to implement the Basel standards to strengthen the regulation of global banks, in line with previous G20 commitments. Additionally, the bill has provisions for delivering on a commitment for long-term market access to the UK for financial services firms in Gibraltar as part of the UK family.


The government is planning for a pension schemes bill, introducing greater powers for the regulator to tackle irresponsible management of private pension schemes. There is a commitment to ‘giving the regulator powers to obtain the right information about a scheme and its sponsoring employer in a timely manner, ensuring that it is able to gain redress for pension schemes and members when things go wrong.’

The bill provides a framework for the establishment, operation and regulation of collective money purchase schemes (commonly known as collective defined contribution pensions), an approach which has been trialled by the Royal Mail.

The pension regulator’s powers and the existing sanctions regime are to be strengthened. This will include introducing new criminal offences, with the most serious carrying a maximum sentence of seven years’ imprisonment and a civil penalty of up to £1m.

In addition the bill includes long-awaited support for pensions dashboards, including new powers to compel pension schemes to provide accurate information to consumers. This will include provisions for the regulators to ensure relevant schemes comply.

The planned legislation will also create regulations to set out circumstances under which a pension scheme member will have the right to transfer their pension savings to another scheme. It will Improve the defined benefit scheme funding system by requiring a statement from trustees on their funding strategy. The legislation for the Pension Protection Fund compensation regime will be amended to enable the fund to continue to apply the compensation regime as intended and amend the definition of administration charges.


There is to be an employment (allocation of tips) bill. This will create a legal obligation on employers to pass on all tips, gratuities and service charges to workers without any deductions. There will be a requirement for employers to distribute tips in a fair and transparent manner, where employers have control or significant influence over the distribution of tips, and to follow a new statutory code of practice which will set out the principles of fair and transparent distribution of tips.

The Queen’s Speech referenced commitments set out in the good work plan developed under previous prime minister Theresa May, which adopted some of the recommendations of the Matthew Taylor review of working practices.

It included a commitment to increase fairness and flexibility in the labour market by stopping employers and workers experiencing significantly different outcomes from flexible forms of working. There will also be legislation to strengthen workers’ ability to get redress for poor treatment, including by improving the enforcement system, and increase transparency and clarity for workers and employers, taking account of modern working relationships.

Airline insolvency

In the wake of the Thomas Cook collapse, the government intends to introduce reforms to airline insolvency, so as to strike a better balance between strong consumer protection and the interests of taxpayers.

This will include the introduction of a special administration regime for airlines and tour companies to support the needs of passengers post-insolvency and to keep aircraft flying long enough for passengers to be repatriated.

Queen’s Speech background briefing

By Pat Sweet

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