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FOI reference - FOI 2015-03-24
Date - 24/03/2015

Request

I require you to disclose to me the total number of cases since 1 January 2010 where The Pensions Regulator has exercised its powers to appoint an independent trustee to a pension scheme, and the number of those cases where the appointment has been in favour of Dalriada.

Response

Information we are able to supply

The total number of cases since 1 January 2010 where the regulator has exercised its powers to appoint an independent trustee to a pension scheme:

Since 1 January 2010, the regulator has appointed an independent trustee (IT) in respect of 184 appointments. (All figures provided in this response reflect the number of cases in which an IT appointment power has been exercised. This is not indicative of the number of schemes an IT has been appointed to as the regulator can appoint a single IT to multiple schemes under one ‘appointment’).

The number of those cases where the appointment has been in favour of Dalriada:

Since 1 January 2010 Dalriada has been appointed as IT in respect of 24 appointments.

Duty to provide advice and assistance

I am mindful of the duty to provide advice and assistance to requesters, as far as it is reasonably practicable to do so. It therefore may be useful for me to explain in more detail how ITs are appointed by the regulator and the regulator’s Determinations Panel ('the panel').

The regulator has a range of powers that it can use to intervene and help put things right, where necessary (such as appointing an IT to a scheme or schemes). Whilst the regulator's staff have the discretion to appoint an IT in some prescribed circumstances, some IT appointments can only be exercised by the panel.

The panel, though a committee of the regulator, is separate from the regulator, in that it has a separately appointed membership and legal support. This enables it to make its decisions independently and impartially in considering all the evidence before it and providing each party with a reasonable opportunity to present their case.

Under s23 of the Pensions Act 1995 ('the 1995 Act'), the regulator can (but is not obliged to) appoint an IT from its trustee register in relation to a trust scheme in circumstances where the employer has entered into an insolvency process. If we appoint, it is a non-reserved regulatory function so can be exercised within the regulatory arm of the regulator.

The regulator also has power to appoint an IT under sections 7(1) and 7(3) of the 1995 Act in circumstances where the employer has not entered into an insolvency process. Section 7(1) applies if the appointment is to replace a prohibited or disqualified trustee. An appointment may be made under section 7(3) if the regulator is satisfied that it is 'reasonable' to do so on one of the four specified grounds. The four grounds are:

  • 7(3)(a) - To secure that the trustees as a whole have, or exercise, the necessary knowledge and skill for the proper administration of the scheme,
  • 7(3)(b) - To secure that the number of trustees is sufficient for the proper administration of the scheme,
  • 7(3)(c) - To secure the proper use or application of the assets of the scheme, or
  • 7(3)(d) - Otherwise to protect the interests of the generality of the members of the scheme.

Sections 23 and 7(3)(b) can be exercised within the regulatory arm. Appointments under sections 7(3)(a), (c) and (d) are all reserved regulatory functions so must be exercised by the panel.

The regulator will always consider the best interests of scheme members when considering a trustee appointment and we have a structured process in place for identifying which trustees on our register have the relevant skills and experience for each appointment we make. Our process includes a tendering and review process which ensures that we select the trustee firm that will provide the best service in terms of time, cost and quality. This process is completed for each appointment the regulator makes (whether by the regulatory arm or the panel).

Please note that, whilst the regulator already publishes the number of trustee appointments it has made in its annual report and accounts, this figure is not isolated to IT appointments but includes ‘member appointments’ and will therefore differ from the information I have provided above. A member appointment is where the regulator appoints a scheme member, typically the remaining member of their occupational scheme, to act as trustee of their own benefits in order to release those benefits in the absence of a solvent scheme employer.

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