The Pensions Regulator (TPR), the UK’s workplace pension watchdog, said it in its corporate plan for 2019-2022 that its “regulatory grip” has extended to “far more” plans than ever before, and that it will take a more targeted and proactive approach to keeping pension trustees honest.”
“The past year has seen our first prosecution for fraud, our first custodial sentence, and the courts handing down the largest ever fine following a TPR prosecution,” said Mark Boyle, chairman of TPR, in a release. “We have also seen a number of high-profile cases being resolved, including Southern Water agreeing to pay £50 million into its pension scheme under a shortened recovery plan.”
The corporate plan also outlines ways the regulator intends to improve the participation, accountability, protection, and confidence in occupational pension plans. TPR said it will send communications clarifying duties and its expectations to defined benefit plans, newly authorized master trusts, defined contribution plans, and new employers with auto enrollment responsibilities.
The regulator said its new supervision team has already started to build one-on-one relationships with larger plans, and is supervising more than 20 plans with many more expected. It said this will help ensure TPR better understands the challenges pension plans face and identify potential future risk.
Additionally, TRP is sending communications to more than 1,000 plans this year to monitor how savers are being treated when it comes to matters such as dividend payments to shareholders, length of recovery plans, and efficient record-keeping.
TPR will also use a “rapid response” team to respond more quickly to reports and intelligence about companies or major restructuring plans.
“By driving up participation in workplace pensions and holding those we regulate to account, we are protecting pension savers and the Pension Protection Fund and increasing confidence in pension saving,” said Charles Counsell, TPR’s chief executive. “We are striving to deliver better retirement outcomes.”
The regulator also said that it will build on last year’s joint strategy with the Financial Conduct Authority (FCA) on dealing with key risks facing the pensions sector. The two will launch a joint review of how disclosures and information from plans and providers combine with guidance and advice services to help pension savers make well-informed decisions.
TPR will also continue to work actively with FCA and the Money and Pensions Service (MAPS) on pension transfers to ensure that they work effectively for those who want to transfer, but enable savers to understand the risks involved and the options available to them.
The following are TPR’s six priorities for the next three years, according to the corporate plan:
- Extending regulatory reach with a wider range of proactive and targeted regulatory interventions.
- Providing clarity, promoting and enforcing the high standards of trusteeship, governance, and administration.
- Intervening where necessary so that defined benefit plans are properly funded to meet their liabilities as they fall due.
- Ensuring staff have an opportunity to save into a qualifying workplace pension, through automatic enrollment.
- Enabling workplace pensions to deliver their benefits through significant change, including responding to Brexit.
- Building a regulator capable of meeting the future challenges it faces.