The Pensions Regulator has stopped the pension trustees of high street retailer Dunnes Stores in Northern Ireland from running its defined contribution scheme after a series of governance failures.
To protect savers, the watchdog appointed Dalriada Trustees as independent trustees to oversee the Dunnes Stores (Bangor) Limited Management Pension Scheme.
The acting trustees were found to be lacking the knowledge and understanding needed to govern the scheme properly, putting the benefits of 390 members at risk, TPR stated.
Dunnes Stores' nominated trustees had also failed to engage properly with TPR during its investigation, and persistently failed to address a number of governance concerns raised by the watchdog, despite assurances that they would.
The regulator’s determinations panel found that despite more than a decade of being responsible for running the scheme, the employer nominated trustees had failed to "familiarise themselves with the requirements of UK pensions legislation".
The trustees showed "that they do not have, or are not exercising, their knowledge and understanding for the proper administration of the scheme" which led to a series of governance errors with little attempt to rectify them, it added.
Dalriada is now in the process of considering the future of the scheme as to the best way to protect the members' benefits. Members will be kept informed on the future of the scheme, the regulator stated.
This is the first time TPR has used its power to appoint a trustee primarily because of a lack of competence of the existing trustee board.
According to Nicola Parish, TPR’s executive director of frontline regulation, the watchdog won’t "stand by when trustee incompetence threatens the retirement outcomes of workplace pension savers".
She added: "In this case, the trustees put member outcomes at risk, and so we took action to ensure benefits are protected.
"The trustees have been replaced because they have consistently failed to show they had the skill to do the job properly.
"Trustees who are not committed to their duties should consider whether it’s right that they continue in their position of being responsible for governing a pension scheme."
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