My questions relate to the questioning of Charles Counsell at the Commons Select Committee on 29 June 2019.
At 10:11:45 of the recording on the parliament archives, Nigel Mills asks whether under current accounting rules, the size of the pensions issue could be hidden which made the companies able to declare large dividends and what was The Pensions Regulator (TPR) doing about that?
1. Charles says that there is an inquiry into exactly that. Can you clarify the name of this inquiry and the timeline to completion and recommendations? Is TPR recommending for International Financial Reporting Standards (IFRS) to be changed?
Later on in the recording, Charles makes reference to a what Warning Notice provided to a sponsor of the Railway Pension Scheme.
2. Can you set out the name of this company and a summary of your engagement with the scheme during the valuation?
I can confirm that we hold information falling within scope of your request. However, we are unable to supply some of the information requested for the reason[s] set out below.
Information we are able to supply
In respect of your first question and discussions regarding the accounting rules, Charles confirmed that this was not being looked in to by TPR as it not our areas of expertise. He then referred to an ongoing inquiry by the Financial Reporting Council (FRC), as the competent authority that investigates accounting matters.
Information we are not able to supply
We are unable to disclose the name of the company subject to a Warning Notice as this constitutes restricted information. This is defined section 82(4) of the Pensions Act 2004 (PA04) as 'information obtained by the Regulator in the exercise of its functions which relates to the business or other affairs of any person’.
Under section 82(5) of the PA04 it is a criminal offence to disclose such information except as permitted under that Act.
Whilst the Freedom of Information Act (FoIA) is based on the presumption of releasing information, section 44(1)(a) of the FoIA provides an absolute exemption to the requirement to disclose any information if its disclosure is prohibited by or under any enactment. In this case, section 82 of the PA04 prohibits disclosure and we are unable to disclose the requested information. This exemption is absolute and does not require a public interest assessment be undertaken.
However, we can confirm the following:
In 2016 TPR commenced enforcement action in respect of one train operating company (TOC) section and was preparing to issue a Warning Notice, but this was put on hold in late 2017 following a constructive response from the trustee and TOCs to our concerns. We are continuing to work with the trustee, TOCs and Department for Transport.
Charles clarified this point in his subsequent letter the Work and pensions Select Committee dated 12 July. This was published on the Work and Pensions Committee website.