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TPR issues first fine to a public service pension scheme

Ref: PN17-43
Thursday 27 July 2017

The Pensions Regulator (TPR) has fined a public service pension scheme £1,000 for failing to submit basic information required by law.

TPR issued the fine against the London Borough of Barnet scheme manager for part of the Local Government Pension Scheme for England and Wales, for failing to submit its 2016 scheme return.

A regulatory intervention report published today (PDF, 66kb, 5 pages) outlines the case and action taken by TPR.

Scheme managers of public service schemes are expected to complete a scheme return which provides TPR with basic information about a scheme such as number of members and participating employers, contact details and information about its pensions board. Depending on the nature and size of the scheme, trustees and managers are sent a scheme return notice at least once every three years.

TPR needs this information from scheme returns in order to be able to carry out its role effectively.

Nicola Parish, TPR’s Executive Director of Frontline Regulation said: “It is the legal responsibility of trustees and managers to submit a scheme return by the deadline. This is one of the most basic regulatory requirements for trustees and managers and it is vitally important that we have up-to-date information about schemes so we can carry out our role effectively. We are also concerned if it is not submitted, as this may signal further problems within the administration of the scheme. Good scheme governance is a key factor to achieving positive outcomes for members. The action we took in this case demonstrates our commitment to this.

“We have shown that where managers and trustees are failing with their basic duties, including in large public service schemes such as this one, we will use our powers to intervene”

TPR issued a scheme return notice to Barnet Council on 9 July 2016, requesting the scheme return be submitted by 12 August. The return was not received and, further communications from TPR not replied to, so the matter was referred to TPR’s Determinations Panel on 24 February 2017.

The penalty notice was issued to London Borough of Barnet, as scheme manager, on 13 April and paid on 9 June.

As the scheme return was not submitted a TPR case team is continuing to engage with local authority staff to discuss the scheme’s future governance and administration.

Editor's notes

  1. Today’s report is published under section 89 of the Pensions Act.
  2. The scheme return is how TPR captures information about pension schemes – to maintain our register of pension schemes and to help us identify pension schemes where there’s a potential risk to members’ benefits. We also use this information to calculate annual levy charges.
  3. In June 2016, Andrew Warwick-Thompson, then Executive Director for Regulatory Policy, said: “The information required in this year’s scheme return is pretty basic so we don’t expect schemes to have any difficulty completing the form. Our website lists the required information so schemes can start to pull it together before they receive their scheme return notice. Completing and submitting the scheme return on or before its return date is a legal requirement, so if you’re having any difficulties, please get in touch.
  4. TPR issues warning notices to trustees and managers that have failed to comply with their legal duty to provide a scheme return to us by the required date. A warning notice will indicate that TPR will impose a financial penalty against the trustee(s) or manager, unless they provide their scheme return by a certain date.
  5. There is a discretionary penalty for failing to provide a scheme return, and we can impose a maximum fine of £5,000 for an individual and up to £50,000 in other cases (eg corporate trustees).
  6. TPR is the regulator of work-based pension schemes in the UK. Our statutory objectives are: to protect members’ benefits; to reduce the risk of calls on the Pension Protection Fund (PPF); to promote, and to improve understanding of, the good administration of work-based pension schemes; to maximise employer compliance with automatic enrolment duties; and to minimise any adverse impact on the sustainable growth of an employer (in relation to the exercise of the regulator’s functions under Part 3 of the Pensions Act 2004 only).

Press contacts

David Morley 01273 662091

pressoffice@thepensionsregulator.gov.uk

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