Supervisory return, scheme return and significant events

CDC code in force: 31 July 2026

1. Once a CDC scheme is authorised, those running it must continue to satisfy us that it meets the authorisation criteria on an ongoing basis. Our continuing assessment of the criteria and all other relevant duties and requirements is called supervision.
2. Supervision is a risk-based, proactive process that allows us to understand how a CDC scheme continues to meet the authorisation criteria. This will be achieved through our supervisory relationship.
3. When a scheme is authorised, we will carry out an evaluation of the scheme which will summarise:
   1. our intended supervisory intensity
   2. the key risks we have observed
   3. the actions we expect the scheme to take
   4. our planned engagement timetable, focusing on any risks or issues
4. This approach will be reviewed and adapted as appropriate.
5. There should be suitable governance in place, including monitoring and reporting to the trustee board, to enable timely engagement with us and to report to us as required.
6. Supervision under the CDC legislation does not operate in isolation. Schemes are also subject to other oversight and activity for example, relating to other legislative requirements, codes of practice and thematic reviews.

Supervisory return and scheme return

7. The trustees may, by notice, be required to complete a supervisory return to provide information to satisfy us that the scheme continues to meet the authorisation criteria¹.
8. The trustees will receive at least six weeks’ notice to submit the supervisory return. We can ask for a supervisory return no more than once a year and only where we decide it is necessary. We expect to issue the first notices requiring a supervisory return after the scheme has been authorised for a year.
9. The content of the supervisory return will be set, reviewed and updated to aid us in ensuring the scheme’s ongoing compliance with the authorisation criteria. The return is likely to ask for updates to the business plan and/or costs, assets and liquidity plan (CALP), the annual chair’s statement and to highlight any issues or changes in the scheme.
10. Trustees are also required to complete an annual scheme return to provide us with certain registrable information². 

Significant events

11. Significant events³ are circumstances arising during the operation of a CDC scheme that must be notified to us as soon as reasonably practicable once the person is aware that the event has occurred.
12. When a significant event occurs, our focus will be on whether we remain satisfied that the scheme continues to meet the authorisation criteria. If we are no longer satisfied that a CDC scheme meets the authorisation criteria, we may take regulatory action, including deauthorising it.
13. The duty to notify us falls on most parties involved in supporting the management of the scheme⁴. This typically includes those required to be assessed under the fit and proper criteria but also extends to advisers and administrators⁵.
14. More than one person may be responsible for notifying us of the same event. As such, we expect schemes to have a process for notifying significant events that avoids the making of duplicate reports where possible.
15. Notifications must be made as soon as reasonably practicable, which we consider to be within five working days of the person with an obligation to report becoming aware of the significant event other than where specified below.
16. Those required to notify significant events should consider reporting if they are unsure on whether to notify or not.
17. We expect schemes to have systems and processes in place to monitor and address significant events and to help those with reporting duties to fulfil their obligations.
18. We will use the information you provide to help consider and assess whether we remain satisfied the scheme continues to meet the authorisation criteria. If we are not satisfied with the scheme’s response to the event, and therefore not satisfied that the scheme continues to meet the criteria, we may take further action, including deauthorising the scheme.

Events relating to persons who are required to be assessed as fit and proper⁶

19. We expect all changes to persons who are required to be assessed as fit and proper⁷ to be reported to us before the individual commences their role. The exception is if an individual is providing temporary cover for up to six months: in these circumstances we do not expect a report to be made and will not complete an assessment.
20. We expect all persons who are required to be assessed as fit and proper and who are subject to one of the events listed in Regulation 23(1)(b) of the 2022 Regulations and Regulation 4(1)(b) of the 2025 Regulations to be reported to us within five days of the individual to whom the event relates becoming aware.

A significant change to the scheme’s investment strategy⁸

21. We expect significant changes to the investment strategy to be reported as a significant event. These could include changes to:
    1. the trustees’ investment philosophy and the style of investment management being pursued
    2. the investment objectives, benchmarks and estimated target returns for the strategy
    3. the range of permissible asset classes, markets, and instruments together with the process for adding new or additional investments
    4. the asset allocation framework detailing the parameters for tactical and strategic asset allocation discretion
    5. the size and nature of the risk budget or the risk factors permitted under the agreed investment arrangements

A proposal to change the design of the scheme, including, but not limited to, a proposal to close the scheme and a proposal to add a section to a scheme that was previously unsectionalised⁹

22. In addition to a proposal to close the scheme to new accruals or new members, this event also includes proposals to narrow the eligible membership. Changes to the prescribed characteristics of the scheme can only be achieved through the closure of the existing scheme and the addition of a new section to provide benefits with the new prescribed characteristics.

An event which, in the opinion of a person with the duty to report, undermines, or is likely to undermine, the soundness of the scheme design¹⁰

23. This could include events outside the running of the scheme, such as an external economic or market event, or a decision taken by the employer. We expect most events of this type to have been identified as part of the modelling and testing supporting the trustee’s considerations of whether the scheme’s design is sound or in the monitoring of investments.

An event that has resulted or, in the opinion of the person with the duty to report, is likely to result in the scheme being unable to meet the specified requirements in relation to its financing¹¹

24. This includes where the assets being held to meet the financial sustainability requirements are not of the classes or in the proportions set out in the financial reserves and haircuts module of this code, are not available to be used when the relevant costs fall due, and where the trustees do not have first call on the assets.

Significant events relating to the ability of the scheme to meet its running costs or maintain the required reserves in appropriate proportions¹²

25. This should be reported to us within two working days of the event occurring, or the person mentioned in those events forming their opinion.

A failure of the systems and processes used in running the scheme, which has a significant adverse effect on the security or quality of data or on service delivery¹³

26. This includes an adverse effect on security or quality of data or on service delivery brought about by a series of events or failures, as well as single significant events. This may include errors in the actuarial valuation. Where the key objectives and tasks in the function holder governance statements are not met, and this failure increases the key risks identified, we expect this to be reported as a significant event. This will include where investment management arrangements have not been followed.
27. In general, notifications of this event should look at divergence from the objectives set for the scheme and tolerance of risk as set out in the risk register. This includes considering the balance of probabilities that the failure has, or will have, an adverse effect that a scheme’s existing systems and processes cannot rectify without impacting on the security or quality of data, or on service delivery.
28. Where the failure has had, or will have, an adverse effect on the scheme’s data security you should report to us when a report is made to the information commissioner.

A failure of the systems and processes for communicating with relevant persons, which has a significant adverse effect on communication with relevant persons¹⁴

29. This includes an adverse effect on communications with relevant persons brought about by a series of events or failures as well as single significant events. Notifications of this event should look at the balance of probabilities that the failure has, or will have, an adverse effect that a scheme’s existing systems and processes cannot rectify without impacting on communications with relevant persons.

A proposal to make a significant change to the systems and processes used in running the scheme (including the systems and processes for communicating with relevant persons)¹⁵

30. This is not intended to capture the general upkeep or maintenance of systems. We expect notifications of proposals such as changing:
    1. the scheme’s administrator
    2. the system being used to run the scheme
    3. the persons responsible for delivering key services to the scheme, such as investment advisers or managers
    4. the scheme payroll provider (if different from the administrator)

There is an investigation of the scheme, or a person involved in a scheme, by a regulator or other competent authority including those outside the United Kingdom¹⁶

31. We consider notification of this event as soon as reasonably practicable to mean notifying us immediately after becoming aware of the investigation.
32. A competent authority is a person or organisation with powers to carry out an investigation and take regulatory action. This includes the Financial Conduct Authority (FCA), Prudential Regulation Authority (PRA) and investigative agencies, such as the police and the Serious Fraud Office (SFO).

A proposal to begin marketing of the scheme (multi-employer CDC schemes only)¹⁷

33. If there is a proposal to begin promotion or marketing of the scheme, information provided must include:
    1. the details, reasons and objectives of the proposal
    2. how the interests of the members of the scheme have been considered
    3. how the authorisation criteria will be met

A person has carried out promotion or marketing of the scheme that is unclear or misleading (multi-employer CDC schemes only)¹⁸

34. We expect all persons responsible for notifying us of a significant event to receive adequate training to be able to identify whether any promotional or marketing material is unclear or misleading. We expect a notification to be made where:
    1. the description of scheme benefits is not in line with the scheme design documentation and actuarial certification
    2. the description of how scheme benefits are accrued and applied is not clear and easy to understand
    3. the material does not provide a balanced view of the risks associated with the scheme
    4. claims about scheme benefits are materially exaggerated

A change which requires a revised business plan to be submitted (multi-employer CDC schemes only)¹⁹

35. Any change that requires a revision to the business plan outside of the annual review cycle must be reported as a significant event.

Any failure to meet a key milestone, target, estimate or assumption in the business plan (multi-employer CDC schemes only)²⁰

36. Any failures to meet a key milestone, target, estimate or assumption in the business plan must be reported.

The scheme is unable or unlikely to meet its liabilities on demand (multi-employer CDC schemes only)²¹

37. This may occur where the scheme actuary, or any other person responsible for monitoring the scheme liabilities, becomes concerned that there is a significant possibility of the scheme not being able to meet its liabilities on demand or any reserves or assets held as security are insufficient to meet the scheme’s liabilities on demand.
38. We consider notification of this event ‘as soon as reasonably practicable’ to mean within one working day of the person becoming aware that:
    1. the scheme cannot, or is not likely to be able to, meet on demand any of its liabilities from an accounting perspective as and when they fall due during the ordinary course of business – this includes, for a scheme proprietor, trading whilst insolvent or likely to trade whilst insolvent
    2. the scheme is unlikely to meet its costs (expected or unexpected costs) – for this event, we are likely to consider whether we are satisfied that the scheme remains financially sustainable, and the trustees and scheme proprietor should monitor whether they need to notify a triggering event

That the scheme is unable or unlikely to meet the level of assets or liquidity agreed with us and set out in the business plan (multi-employer CDC schemes only)²²

39. We consider notification of this event ‘as soon as reasonably practicable’ to mean within one working day of the person becoming aware that this event has occurred for at least two consecutive working days. We will expect a notification to be made where financial reserves fall to less than 98% of the level agreed in the CALP or business plan.

That there has been a change to the financial reporting period to be used in the scheme accounts or those of the scheme proprietor (multi-employer CDC schemes only)²³

40. We consider notification of this event should be made within five working days of the decision to change the reporting period.

An event which undermines or is likely to undermine the ability of the trustees of the scheme to pursue continuity option 3 (multi-employer CDC schemes only)²⁴

41. Where continuity option 3 is not being pursued, we expect to receive notification within five working days of becoming aware of the situation. If this event occurs during a triggering event period, or while continuity option 3 is being followed, we expect that notification should be made on the same day, or next working day if it takes place on a non-working day.

Legal references

¹ Section 27 of the Pension Schemes Act 2021, Regulation 22 of the 2022 Regulations, and Regulation 45 of the 2025 Regulations

² 165 Section 64 of the Pensions Act 2004

³ Section 28(1) of the Pension Schemes Act 2021, Regulation 23(1) of the 2022 Regulations, and Regulation 46(1) of the 2025 Regulations

⁴ Section 28(2) of the Pension Schemes Act 2021

⁵ Sections 28(2)(e) and (f) of the Pension Schemes Act 2021

⁶ Section 11(2) of the Pension Schemes Act 2021

⁷ Regulation 23(1) of the 2022 Regulations and Regulation 46(1) of the 2025 Regulations

⁸ Regulation 23(1)(c) of the 2022 Regulations and Regulation 46(1)(c) of the 2025 Regulations

⁹ Regulations 23(1)(d) and (e) of the 2022 Regulations and Regulations 46(1)(d) and (e) of the 2025 Regulations

¹⁰ Regulation 23(1)(g) of the 2022 Regulations and Regulation 46(1)(g) of the 2025 Regulations

¹¹ Regulation 23(1)(h) of the 2022 Regulations and Regulation 46(1)(h) of the 2025 Regulations

¹² Regulation 23(1)(i) and (j) of the 2022 Regulations and Regulations 46(1)(i) and (j) of the 2025 Regulations

¹³ Regulation 23(1)(k) of the 2022 Regulations and Regulation 46(1)(k) of the 2025 Regulations

¹⁴ Regulation 23(1)(l) of the 2022 Regulations and Regulation 46(1)(l) of the 2025 Regulations

¹⁵ Regulation 23(1)(m) of the 2022 Regulations and Regulation 46(1)(m) of the 2025 Regulations

¹⁶ Regulation 23(1)(n) of the 2022 Regulations and Regulation 46(1)(n) of the 2025 Regulations

¹⁷ Regulation 46(1)(o) of the 2025 Regulations

¹⁸ Regulation 46(1)(p) of the 2025 Regulations

¹⁹ Regulation 46(1)(q) of the 2025 Regulations

²⁰ Regulation 46(1)(r) of the 2025 Regulations

²¹ Regulation 46(1)(s) of the 2025 Regulations

²² Regulation 46(1)(t) of the 2025 Regulations

²³ Regulation 46(1)(u) of the 2025 Regulations

²⁴ Regulation 46(1)(v) of the 2025 Regulations

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