PS22/14 – Consumer redress scheme for unsuitable advice to transfer out of the British Steel Pension Scheme

This article will be of relevance to firms who have provided pension transfer advice to members of the British Steel Pension Scheme. Note that imminent action is required.


PS22/14 is due to come into force at the end of this month and requires firms to review pension transfer advice they have provided to members of the British Steel Pension Scheme (BSPS). Below is a summary of the scheme:

  • Comes into force from 28 February 2023
  • Firms are required to assess any advice they gave to BSPS members to transfer out during the period of 26 May 2016 and 29 March 2018 and to pay redress if the advice was unsuitable and caused the consumer a loss
  • The redress scheme is intended to put BSPS members (who suffered detriment due to unsuitable advice), back in the position they would have been if the advice had been suitable
  • The following consumers are not covered by the scheme:
    • Customers of firms who have already gone out of business or who go out of business during the scheme
    • People who were given advice to transfer out of the BSPS but not between 26 May 2016 and 29 March 2018
    • People who have already accepted compensation
    • People who have already referred complaints to the Financial Ombudsman Service
    • People who transferred out of the BSPS after being given advice not to (i.e. insistent clients)
    • People who were out of time to make a complaint before the scheme was implemented
  • The scheme is an opt out (not an opt in), so firms are required to write to in-scope members and offer them the opportunity to opt out. Where a member does not opt out within a set timescale, they will need to be included within the scheme

Important dates

By 28 March 2023

  • Identify all consumers who made a BSPS pension transfer after the firm gave advice in relation to BSPS.
  • Identify all cases which fall within the subject matter of the scheme (scheme cases) and excluded scheme cases
  • Write to all consumers within and outside scope – firms should acknowledge any consumer opt-outs within 5 business days of consumer response

By 28 September 2023

  • Complete case reviews for all non-opted-out scheme cases using the BSPS DBAAT, or an FCA DBAAT completed prior to the scheme. These must be accompanied by an attestation by the compliance senior manager.

For suitable cases:

  • Firms will be required to notify the FCA in the first regular report which falls due after the expiry of 14 days from the date of the redress determination.

For unsuitable cases:

By 28 December 2023 or by 28 February 2024 (where augmentation offer requested and/or a claim for other losses where augmentation offer requested and/or a claim for other losses)

  • Issue no loss redress determination; or
  • Ask consumer to check summary calculation report and accept offer confirming method of payment (if consumer requests full calculation report send it within 5 days of the request) 


The FCA has created a new BSPS-specific DBAAT and firms using this should be aware of some subtle changes versus the standard DBAAT, including the information and pension transfer suitability tabs. Once the scheme has started, firms will be required to complete all reviews for BSPS cases using the FCA DBAAT, unless the firm has already reviewed the case using the standard DBAAT. In either instance, the DBAAT will need to be accompanied by attestation from the compliance senior manager.

Where firms has reviewed the advice provided and concluded it was suitable, they will be required to pass the outcome for the case to the FCA along with the members consumer’s name, address, telephone number(s) and, where available, email address, so that the FCA can assist the consumer to refer cases to the Financial Ombudsman Service (FOS) for an independent review.

Current BSPS complaints and cases at the Financial Ombudsmen Service

Any BSPS member who has a complaint (or  People who have already referred complaints to the Financial Ombudsman Service or is in the  previously or bringing a complaint (whether this is currently with the firm or at the FOS), will be excluded from participating within the scheme. However, the FCA has stated that firms should not put redress cases on hold and the consumer should be given the option to wait until changes have been made to the methodology to have their redress calculated. For clarity, the current redress rules fall under FG17/9 until 1 April 2023 when the new rules under PS22/13 will come into force.

The new FCA redress calculator

The FCA is releasing their own BSPS redress calculator which will be in excel format and should be ready by April 2023. The calculator cannot be used for non-BSPS pension remediation but will ultimately redress the costs that firms will pay in order to arrive at a redress figure, without the need to pay for actuarial services. However, firms will need to familiarise themselves with the appropriate rules within the policy statement and the Consumer Redress Schemes sourcebook (CONRED) rules.

Likelihood of redress for unsuitable cases

The FCA suggest that due to changes in the economic environment, around 32% of all BSPS unsuitable cases are likely to result in a no loss outcome. This figure has increased significantly since CP22/6 was written which indicated that no loss cases would be just 6%. Average redress is also expected to have fallen to around 12% of the pension transfer value (previously 16%) based on extrapolating the latest FSCS claims data (which covers Q3 2022). This fall equates to an average remediation sum payable of approximately £45,000 (previously £60,000).

As a result of the scheme, the FCA are expecting that approximately 40 firms (up to 10% of in scope firms) will fail.

Interaction with PS23/1

Firms should be aware that PS23/1 (Extended asset retention requirement for firms under the British Steel Pension Scheme consumer redress scheme) came into force from 31 January 2023. PS23/1 is an extension of PS22/4 which came into force on 27 April 2022 and placed an asset retention requirement on firms who have advised on five or more BSPS transfers between 26 May 2016 and 29 March 2018. PS23/1 not only extends the asset retention requirement but also increases the number of firms in scope as it now applies to any firm that has advised on three BSPS transfers between 26 May 2016 and 29 March 2018 (previously five under PS22/4).

Important Note: ATEB news is intended to provide general information ONLY. The content, including any views expressed or guidance provided, does not replace the need to comply fully with FCA Rules and Guidance. Unless you have discussed news article content with ATEB, and specifically how it relates to your circumstances, then ATEB disclaims all liability and responsibility and actions arising from any reliance placed upon it. For the avoidance of doubt therefore, any reliance you place on such information without our consultation is at your own risk.

ATEB Compliance offers compliance and regulatory advice.

ATEB Suitability provides report writing software for the financial services market.

Our View

Our apologies – this article is not an easy read. It summarises the policy statement (which is a pretty chunky and technical 323 pages!) and should help firms to gain an quick overview understanding of the required action and timescales. It is intended to be read in conjunction with the policy statement.

Action Required By You

PS22/14 comes into force shortly, so all in-scope firms should ensure they have a good understanding of how the scheme operates, what action is required and when. We recommend that firms start identifying the number of clients impacted and what level of resourcing will be required in order to meet their obligations under the scheme. ATEB can assist firms with the implementation of PS22/14.
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About the Author

Paul is a Chartered Financial Planner and is well on his way to a Fellowship. He has a thirst for technical knowledge and, while he advises on all aspects of financial services regulation, he specialises in pensions and investments.

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