Pensions Regulator  

TPR touts tougher DB approach and shrinking DC universe

TPR touts tougher DB approach and shrinking DC universe

The Pensions Regulator plans to extend its direct supervision of schemes and refocus on prompt transactions, after meeting the majority of its performance objectives over the last year.

In its annual report published yesterday (July 16), the regulator pointed to successes in shrinking the number of defined contribution schemes by 12 per cent, thanks in part to its authorisation of the master trust sector.

It also touted regulatory action taken against former BHS buyer Dominic Chappell and others as evidence of its maintained pressure on defined benefit employers to do the right thing. 

Deficit recovery payments increased over 2019-20 while recovery plan lengths shrunk, with TPR increasing the number of enforcement cases.

The only missed key performance indicator for the regulator in the last year was on staff engagement. 

Despite its claim that staff supported the aims of the organisation, engagement levels of 62 per cent were ahead of benchmarks but behind its target of 75 per cent.

Several of the regulator's targets have also been impacted by events during the year. 

Commenting on a total of 123 schemes under supervision (compared to a target of 128), the regulator stated that it "paused further supervisory work while we reassessed the profile of those we intend to focus on in the forthcoming year, to further extend our regulatory reach".

Similarly, Covid-19 prevented the watchdog from implementing its fifth and final planned regulatory initiative on prompt financial transactions, but the arms-length body plans to resume this work, along with renewed focus on record-keeping, at an appropriate juncture. 

Meanwhile, TPR said its work on pensions dashboards had been delayed by the industry group's failure to finalise data standards for it to enforce.

Announcing the report, chair Mark Boyle said: “Our organisational structure and culture provided a solid base for our Covid response. We have continued to support those we regulate to manage risks and protect pension scheme benefits in an effective, confident and organised way."

He added: “Undoubtedly, we will continue to be affected by external challenges – but I’m confident we will be able to maintain our focus on our statutory duties and ensure workplace pensions continue to work.”

Charles Counsell, who joined the regulator as its chief executive last year, said: “Every saver deserves to be in a well-run and well-governed pension scheme and we have successfully driven up standards across schemes thank to our supervisory approach. 

“We have been in direct contact with more schemes than ever, creating strong, two-way relationships allowing us to monitor closely, clearly outline expectations and prevent problems developing in the first place.”

Mr Counsell continued: “Post-Covid-19, we will be focusing resources on supporting those schemes that need our ongoing attention, including those affected by the pandemic. I’m confident we will be able to further drive up standards when as we look to return to our full supervisory evaluation cycle later in the year.”

angus.peters@ft.com

Angus Peters is editor of Pensions Expert