Intervening more frequently and acting quicker are amongst The Pensions Regulator (TPR) goals for the next three years.
Driving up standards of trusteeship and helping 700,000 small employers meet their automatic enrolment (AE) duties are also among the eight priorities outlined in TPR’s Corporate Plan 2017-2020, published today.
TPR Chief Executive Lesley Titcomb said: "These priorities show how we are evolving to become a bolder, more effective regulator.
"Going forward we will be intervening more frequently and acting faster. Workplace pension schemes play a vital role in the retirement plans of millions of people and we have an important role in protecting their benefits.
"Effective regulation is essential to protect the benefits of members of occupational pension schemes and in recent months we have demonstrated we will use the powers available to us.
"Elsewhere, our corporate plan clearly sets out the importance we place on the quality of trusteeship and how we will work to simplify the guidance and codes we provide to the industry. In addition, the continued successful implementation of automatic enrolment and the increased protection for consumers in master trust schemes remain top priorities."
TPR’s corporate plan lists eight priorities:
- Successfully complete the remaining stages of the roll-out of AE to small and micro employers.
- Deliver more interventions, more quickly, where defined benefit schemes are underfunded or avoidance is suspected.
- Protect customers through the effective regulation of master trusts.
- Drive up standards of record-keeping and data maintenance, including public service schemes.
- Be clearer in our codes, guidance and other interactions with schemes and employers about what we expect them to do.
- Drive up standards of trusteeship across all schemes, with a particular focus on chairs and professional trustees.
- Develop and implement our enhanced approach to regulation.
- Create high performing teams of people across TPR with the skills and capabilities to deliver all of the above.
The corporate plan also identifies five risk areas that have driven TPR’s priorities to address risks facing the UK pensions landscape. These are:
- Poor outcomes for members and sponsors of smaller defined benefit and defined contribution schemes that cannot benefit from economies of scale.
- Standards of governance and administration not increasing at the pace required to meet expectations.
- Potential failure of master trusts and defined benefit schemes.
- The impact of poor record-keeping in both public and private sectors.
- Variable investment conditions arising from political and market uncertainty in the UK and overseas.
By focusing on these risk areas, TPR has refined its 10 priorities from last year’s plan down to eight. These are clearer and more specifically focused to meet its statutory objectives in the changing pensions and risk landscape.
To implement the master trust authorisation regime and increase frontline resources, TPR has set a budget, with the approval of the DWP, which envisages an increase in funding in 2017-18 of £3.5m when compared to the original 2017-18 budget. Taken together with the continued roll-out of automatic enrolment duties to employers, this results in increased spend of £7.9m in 2017-18, compared to the previous year.
Lesley Titcomb said: "In order to meet our revised objectives we need to invest in our systems, as well as enhance the number and potential of our people – particularly our frontline regulatory teams and the specialist advisers who support them.
"As well as continuing to adapt where needed, we maintain our commitment to provide strong, agile and fair regulation, and to promote the highest possible standards from the pensions industry."
- In the coming year, TPR will focus 31% of its resources on frontline regulation, including all non-AE cases and customer support. A further 21% will be allocated to regulatory policy. This incorporates a number of areas looking at policy, research and business analysis. AE work will see 18% of resources and will look at roles such as case work, enquiries and industry liaison.
- 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).