Regulating work-based defined contribution (DC) pension schemes
Open date: 10 January 2013
Closing date: 28 March 2013
Consultation on a new code of practice, regulatory guidance and regulatory approach relating to the administration and governance of work-based defined contribution (DC) pension schemes
The number of people in DC pension schemes will increase dramatically over the next few years. However, many of these new members will be automatically enrolled into a scheme rather than actively deciding to start saving. Our core aim is to ensure that all DC members are placed in schemes that are effectively governed, durable and offer value for money.
This consultation relates to a new code of practice, accompanying regulatory guidance and a regulatory approach document. These will establish a new framework that allows us to regulate the governance and administration of DC schemes. The framework applies to occupational DC trust-based schemes, but we are working with the Financial Services Authority (FSA) to ensure that the regulation of work-based personal pensions (contract-based schemes) delivers comparable outcomes. Read our initial analysis of the DC quality features in FSA regulation of work-based personal pensions (PDF, 85kb).
We have designed the new DC code and regulatory guidance to complement each other and they should be read together. Both publications are underpinned by our six DC principles and an updated version of the DC quality features which represent the standards and behaviours we expect trustees to attain. The DC quality features will help scheme trustees to demonstrate compliance with legal requirements and incorporate best practice.
During development of the DC quality features we carried out research to evaluate the extent to which they are present in existing occupational DC schemes. This provided us with insight into how schemes may interpret and evidence the quality features as well as providing estimates for the current presence of the quality features within schemes. Read our research on the DC quality features.
- Consultation document: Regulating defined contribution pension schemes (PDF, 125kb, 19 pages)
- Annex 1: Regulatory approach: Ensuring good governance and administration in work-based defined contribution pension schemes (PDF, 185kb, 25 pages)
- Annex 2: Code of practice 13: Governance and administration of occupational defined contribution trust-based pension schemes (PDF, 227kb)
- Annex 3: Regulatory guidance: Governance and administration of occupational defined contribution trust-based pension schemes (PDF, 275kb, 43 pages)