The Financial Reporting Council (FRC) has issued finalised guidance to support pension scheme actuaries providing retrospective confirmation for historic rule changes, following the Pension Schemes Act 2026 receiving Royal Assent.

The guidance is intended to help schemes address uncertainty arising from the Virgin Media v NTL Pension Trustees judgment, which raised concerns about the validity of certain historic amendments for which evidence of actuarial confirmation could not be produced.

Originally published in draft earlier this year, the finalised guidance includes minor amendments to wording and references to align with the enacted legislation.

The FRC said the guidance was designed to assist scheme actuaries in considering whether to provide retrospective confirmation under sections 102 and 106 of the Pension Schemes Act 2026 “in a proportionate manner” and to promote consistency across the industry.

Under the legislation, trustees or managers can ask the current scheme actuary to assess whether a historic alteration would have prevented the scheme from continuing to satisfy the statutory standard relevant to contracting-out.

If the actuary concludes it is reasonable to determine that the scheme would still have met the reference scheme test, the amendment can be treated as valid for the purposes of regulation 42.

Meanwhile, the guidance stresses that actuaries are not expected to recreate the exact position of the original scheme actuary or obtain complete historical data in every case.

Instead, it encourages a “proportionate approach” based on readily available information.

It also outlines examples in which no additional evidence may be required, such as amendments that did not reduce benefits or changes that mirrored statutory reforms, as well as more complex cases in which indirect evidence or individual member data may be necessary.

The guidance further notes that scheme actuaries may rely on assumptions or presumptions where appropriate and may use indirect evidence, such as trustee meeting minutes, actuarial valuation reports, reference scheme test certificates, and employer statements on historical earnings patterns.

Broadstone head of policy, David Brooks, said the publication of the finalised guidance, alongside separate guidance from The Pensions Regulator (TPR), meant the industry now had “a complete framework” for dealing with the fallout from the Virgin Media ruling.

“The legislation enables schemes to retrospectively validate historic amendments through actuarial confirmation, while the accompanying guidance sets clear expectations on both methodology and governance," he stated.

“The focus now shifts from theory to implementation. TPR has made clear that trustees are expected to take active steps - assessing exposure, taking advice and formally instructing actuaries - rather than adopting a wait and see approach.

“However, some trustees may still come up against challenges around data gaps, evidential standards and the exercise of judgement in borderline cases. The framework is now in place; the key test for schemes will be how efficiently they can execute it.”

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