The Pension Schemes Act 2017 requires individuals involved in running an authorised master trust scheme (including professional advisers) to notify The Pensions Regulator (TPR) if certain significant events occur in relation to the scheme.
Significant events are matters which affect whether a master trust still meets the authorisation criteria.
When a significant event occurs, we need to understand the impact of the significant event and how it is being managed. Our focus will be whether we remain satisfied that the master trust continues to meet the authorisation criteria. If not, we may decide to take further action, including exercising our powers under section 10 of the Pensions Act 1995 or de-authorising the scheme. Our level of intervention will be determined by a number of factors. This includes the nature of the event and our level of confidence in the master trust's ability to manage any risks arising from the event.
Who must notify us
The Act sets out that the following individuals must notify us if they become aware a significant event has occurred:
- a trustee of the scheme
- a person who (alone or with others) has power to appoint or remove a trustee
- a person who (alone or with others) has power to vary the terms of the trust under which the scheme is established (where the scheme is established under a trust)
- a person who (alone or with others) has power to vary the scheme (where the scheme is not established under a trust)
- a scheme funder
- a scheme strategist
- a person who provides legal, financial or actuarial advice in relation to the scheme
- a person who manages the scheme administration services
While the legal duty to notify falls on each of these individuals, we would expect a master trust to have systems and processes in place to facilitate compliance and manage the notification process.
In particular, we would encourage one single notification on behalf of all scheme funders who are also participating employers, as opposed to multiple notifications of the same event. This is particularly important where there are a large number of scheme funders.
Similarly, the trustee board could collectively submit a notification rather than individually.
How to notify us
The master trust regulations set out the events that you must notify us of. Select the event you need to notify us about:
- (a) a change or addition to fit and proper persons involved with the scheme (unless the change or addition is a triggering event)
- (b) an individual involved with the scheme has a change of circumstances that is likely to affect our assessment of whether they are fit and proper, eg they are convicted of an offence, enter bankruptcy, sanctioned by a regulator or ill health impairs their ability to carry out their role
- (c) a significant change to the statement of investment principles
- (d) a change that requires revision of the business plan
- (e) a failure to meet a key milestone, target, estimate or assumption in the business plan
- (f) the scheme is unable or unlikely to meet its liabilities on demand
- (g) the scheme is unable or unlikely to meet the level of assets or liquidity agreed with TPR and set out in the business plan
- (h) a change to the financial reporting period to be used in the accounts of the scheme or scheme funder, except where regulation 28(1) applies to a scheme
- (i) a change in the financial information which a scheme funder has supplied to TPR with an application for exemption under regulation 8(1)
- (j) a failure of the systems or processes used in running the scheme which has a significant adverse effect on the security or quality of data or on service delivery
- (k) a significant change to the systems and processes used in running the scheme, or in any person responsible for delivering key services to the scheme
- (l) an investigation of the scheme, or of a person involved in the scheme, by a regulator or other competent authority inside or outside the UK
Timescale to notify a significant event
A significant event must be notified as soon as reasonably practicable once a person is aware an event has occurred. Our code of practice sets out what we consider to be reasonably practicable. You should prioritise notifying us even if you don’t have the complete information of the event.
We expect you to engage with us in an open and co-operative way. We are aware that the particular circumstances of a scheme will present different types of risks and we may request further information about the significant event. We may also require you to provide us with information or particular documents under section 72 of the Pensions Act 2004.
If you don't comply
Failing to comply with your duties may result in a financial penalty being imposed.
For further information about financial penalties, see: