The new description focuses on whether a person’s business includes trusteeship. Someone will normally be considered a professional trustee if they have represented themselves to one or more unrelated schemes as having expertise in trustee matters generally.
Professional trustees are likely to be given higher penalties under the penalties policy.
Anthony Raymond, TPR’s acting executive director for regulatory policy, said: “It is vital that trustees have the right skills to ensure that their pension scheme is managed effectively but it is also right that they are held to account if they fail to provide proper governance.
“Professional trustees bring real benefits to a board through their expertise and experience, sharing knowledge and good practice from other schemes. Our role is to protect members’ benefits and the policy sets out who we will consider to be a professional trustee and hold to a higher standard.”
The new description paves the way to build standards and accreditation for professional trustees through the Professional Trustee Standards Working Group (PTSWG), which has been established by the industry’s professional trustee bodies. The group is developing higher standards for those who are considered to be professional trustees.
Representative and professional bodies, trustees, pension providers and advisers were asked for their thoughts on TPR’s proposed approach earlier this year. The consultation also included a request for views on the way TPR imposes monetary penalties.
The regulator said it would not normally consider a remunerated trustee to be acting as a trustee of the scheme in the course of the business of being a trustee if they are or have been: a member of the pension scheme or a related pension scheme (ie a scheme with a sponsoring employer in the same corporate group or employed by, or a director of, a participating employer in the pension scheme (or an employer in the same corporate group); and they do not act, or offer to act, as a trustee in relation to any unrelated scheme.
TPR has also today (10 August) published its monetary penalties policy, which explains how it will generally use its powers to impose penalties under pensions legislation, and its consultation response.
Those who responded to the consultation were generally supportive of TPR’s approach and the differentiation of penalties between professional and lay trustees.