The Pension Schemes Act 2026 includes provisions designed to avoid past pension scheme amendments being void on a technicality due to no “section 37 certificate” having been obtained from the scheme actuary at the time. The provisions are now in force. We take a look at the provisions and related regulatory guidance and consider the steps that trustees should be taking now.
The Pension Schemes Act received Royal Assent on 29 April 2026. The measures designed to provide a “fix” for the issues stemming from the Virgin Media case came into force on that date.
The court’s judgment in the Virgin Media case found that amendments to contracted-out schemes made from 6 April 1997 to 5 April 2016 were void if the trustees had not obtained a “section 37 certificate” from the scheme actuary confirming that the scheme would continue to meet the statutory standard for contracting out following the amendment. The effect of the case was to call into question the validity of many scheme amendments which had been treated as valid for many years. In practice it was often not possible to find the section 37 certificate and therefore not straightforward to demonstrate that one had been obtained.
The “fix” provisions in the Act mean that relevant scheme amendments can generally be treated as having always met the section 37 certificate requirements provided the scheme’s actuary confirms in writing to the trustees that in the actuary’s opinion it is reasonable to conclude that the amendment would not have prevented the scheme from continuing to satisfy the statutory standard for contracted-out schemes.
If a scheme was wound up or the PPF assumed responsibility for a scheme before 29 April 2026, amendments will not be subject to challenge on the grounds that the section 37 certificate was not obtained.
The Pensions Regulator has published guidance on the section 37 certificate fix. The guidance suggests that trustees may need legal help to write the instruction to the actuary. It flags the importance of being clear as to the scope of what the actuary is being asked to consider (for example, if a deed makes more than one amendment, whether the actuary is to consider the overall effect of the amendments or each amendment individually). Where it is not clear whether a section 37 certificate was obtained, the guidance says that trustees should weigh up the cost/benefit of devoting resources to tracking down evidence of past certification versus assuming that no certificate was obtained and moving directly to obtaining confirmation under the new fix provisions.
The guidance says that trustees should maintain a clear audit trail for all decisions, actions and results relating to remediation issues, and that any section 37 certificates and actuarial confirmations obtained under the new fix provisions should be held by whoever holds the scheme’s formal documentation such as trust deeds and rules.
In our March 2026 Update we reported on the FRC’s draft guidance for actuaries in relation to the fix provisions. In May 2026 the FRC published the finalised version of the guidance. The final version is almost identical to the draft. It clarifies that where the actuary is asked to give a confirmation under the fix provisions, but there is legal uncertainty as to whether the original amendment required a section 37 certificate at all, the actuary may wish to consider providing confirmation if appropriate, but making clear that this is only a formal confirmation under the statutory provisions to the extent that the case is within scope of the fix.
Now that the fix provisions are in force, trustees who have not already done so should identify past amendments for which actuarial confirmation should be obtained, and should provide appropriate instructions to the scheme’s actuary.
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