The Pensionist - Episode 7: Whose surplus is it anyway?

In this episode of The Pensionist, we turn to a question that would have seemed almost fanciful only a few years ago: what should schemes do with a defined benefit surplus? With well-funded schemes now surging across the market, the return of surplus is moving from theoretical possibility to practical reality for a growing number of schemes. 

The rules, however, are far from simple. The treatment of surplus depends heavily on whether a scheme is ongoing or in wind-up, and the strict statutory conditions that currently apply to refunds from ongoing schemes are about to change. The Pension Schemes Act 2026 will give trustees a new statutory power to amend their rules to permit a refund of surplus while the scheme is ongoing, and will lower the funding threshold from a buyout basis to a low dependency basis, with regulations expected to come into force on 6 April 2027.

Hosted by Larisa Gordan, Senior Associate in Fieldfisher's Pensions team, this episode features Jeremy Harris, Pensions Partner at Fieldfisher, and James Chalk, Client Director and professional trustee at Vidett. Together they work through how surplus can be used or returned, the legal rules and trustee duties that shape those decisions, the key trust law authorities from Edge to Merchant Navy Ratings and Bristol Water, market practice on how surplus is typically split between sponsors and members, run-on strategies for well-funded schemes, and the brand-new June 2026 DWP consultation and accompanying TPR guidance.