Regulator sets out strategic plan

Preparing for automatic enrolment, improving standards of governance and administration, and filling deficits as soon as reasonably affordable are amongst the top priorities set out in The Pensions Regulator’s fourth corporate plan. 

The corporate and business plan 2010-13 (PDF) sets out how the regulator will continue to protect members’ benefits in a climate of financial uncertainty that has impacted both pension schemes and sponsoring employers.

In anticipation of our new duties, which bring new and different audiences, the regulator has also overhauled the design and content of its website – tailored to be user-friendly for employers, individuals, pension professionals and trustees – and launched new information for employers to help them get ready for workplace pension reforms.

During the next three years the regulator will:

• Continue to emphasise to trustees the importance of setting prudent funding targets and agreeing with employers that any resulting deficit is filled as quickly as possible.
• Support employers to get to grips with their new duties to auto-enrol staff into workplace pension schemes, and the regulator will design and build an effective compliance regime.
• Focus on standards of delivery of DC schemes - looking to trustees and providers to ensure they are effectively run and suited to members’ needs.
• Improve standards of administration across the industry.
• Continue to raise standards of governance by trustees, ensuring governance of DC issues receives appropriate attention.
• Continue to monitor transfers of pensions risk away from employers to ensure that, where such practices occur, members’ benefits are protected.
• With an increasing workload and in an environment of constrained public expenditure, continue to direct its resources in the areas of greatest risk to members, educate and enable the industry to respond, and reduce the risk of calls on the Pension Protection Fund (PPF).

Earlier this year, an independent review by the Better Regulation Executive and National Audit Office (NAO) concluded that the regulator had an effective and proportionate approach and had thoroughly embedded the Hampton principles in its work.

Pensions Regulator chief executive Tony Hobman said:

“The persistent effect of the downturn on pension schemes and sponsoring employers, together with preparations for workplace pension reform, mean a busy and challenging time ahead.

“The recent Hampton Implementation Review recognised the progress we have made, and it’s important we build on those achievements.

“Our goal will be to maintain a sharp focus on protecting members’ pension benefits and the PPF, taking regulatory action if necessary, without creating unnecessary burdens on businesses.”

The regulator’s website will feature simple guides for those who are new to pensions as well as regulatory guidance and codes of practice for our traditional audience of trustees and pensions professionals.

A leaflet will be published in coming weeks to inform employers of their new workplace pensions reform duties, followed by further web content later in the year. The regulator will also be consulting on its enforcement strategy for the new employer duties to auto-enrol employees into pension schemes from 2012.

1. Incorporated in this three-year view is a more detailed Business Plan for the year 2010-11. This enables us to deliver our statutory objectives and corporate strategy. The business plan can be viewed on our website.
2. The Pensions Regulator is the regulator of work-based pension schemes in the UK, with objectives to protect members' benefits, promote good administration and reduce the risk of calls on the Pension Protection Fund. Our approach is risk-based focusing on education and enablement, with enforcement where appropriate. We have the ability to:
   • collect information about pension schemes; through scheme returns, under the scheme funding regime and as well as statutory (including whistleblowing) reports;
   • issue notices requiring actions to tackle non-compliance, prohibit trustees who are judged not fit and proper to carry out their duties or appoint independent trustees;
   • direct pension schemes as to how to calculate their liabilities and the contributions required;
   • issue a contribution notice where there is an attempt to avoid liabilities, or a financial support direction where the employer is a service company or insufficiently resourced.
3. In the 2008 Pensions Act, The Pensions Regulator was given a new statutory objective to maximise compliance with employer duties (including the requirement to automatically enrol eligible employees into a qualifying pension provision and pay a minimum contribution) and with certain employment safeguards.

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