The Pensions Regulator

Pensions Regulator consults on codes of practice

Ref: PN05-24
9 September 2005

The Pensions Regulator has today published two draft codes of practice for consultation. The Reasonable periods for the purposes of The Occupational Pension Schemes (Disclosure of information) Regulations 2006 (“Reasonable periods in Disclosure”) and Internal controls codes are now on the regulator’s website and the pensions industry is invited to take part in the consultations.

The Reasonable periods in disclosure code of practice gives trustees, employers and advisers guidance on what the Pensions Regulator considers is a reasonable amount of time to disclose the information set out in the proposed new regulations on disclosure of information. The code introduces flexibility to the interpretation of what a reasonable period is for supplying information.

The Pensions Regulator has also published the draft Internal controls code of practice, which gives guidance to trustees on how to comply with the proposed regulations on internal controls.

The Internal controls code seeks to give guidelines to trustees and managers of occupational pension schemes, as well as outline the regulator’s expectations in relation to the assessment of risk, implementation and review of adequate internal controls. The Pensions Regulator recommends trustees develop a risk management framework to assess the adequacy of internal controls.

To take part in the consultations visit www.thepensionsregulator.gov.uk

Editor's notes

1. The Reasonable periods in disclosure code of practice sets out the regulator’s view as to what constitutes the reasonable time periods set out in The Occupational Pension Schemes (Disclosure of Information) Regulations 2006.
2. The Occupational Pension Schemes (Internal Controls) Regulations 2005 bring the UK into line with Article 14(1) of the EU Directive 2003/41/EC. The regulations place an obligation on trustees and managers to have adequate internal controls and the code provides guidelines on how they can comply.
3. Internal controls are:
4. • arrangements and procedures to be followed in administering and managing the scheme;
   • systems and arrangements for monitoring that administration and management; and
   • arrangements and procedures to be followed for the custody and security of the assets of the scheme.
5. The draft regulations have been published by the Department for Work and Pensions (DWP). Consultation documents seeking the views on the draft regulations is available on the DWP website at http://www.dwp.gov.uk/consultations/2005/
6. Codes of practice are not statements of the law. However, they do have evidential value, meaning they will be taken into account by a court or tribunal where relevant.
7. The Pensions Regulator has been established as the new regulator of work-based pensions in the UK, with wider and more flexible powers under the Pensions Act 2004. It has replaced Opra which no longer exists.
8. The new powers of the Pensions Regulator include the ability to:
9. • collect more detailed scheme information;
   • impose a statutory obligation on ‘whistleblowers’ to report suspected breaches of the legislation to the regulator;
   • issue improvement notices and third party notices, enabling the regulator to ensure problems are put right;
   • freeze a scheme that is at risk, while the regulator investigates; and
   • prohibit trustees who are judged not fit and proper to carry out their duties.