The Pensions Regulator ( TPR ) has published its corporate plan for 2018 to 2021. A key priority is improving frontline resources after a number of high profile ‘corporate scandals’ which has seen tens of thousands of pension scheme members disadvantaged.
TPR is going to increase spending by £4.3m (an increase of 5.2%) and ensure a third of its staff are working on front line regulation, automatic enrollment and policy and advisory work. This investment in resources and funds will, according to TPR, help in ‘cracking down on sponsoring employers who are not taking their duties towards their pension schemes seriously’ and ‘focus on delivering better regulatory outcomes.’
TPR has, in the recent past, faced mounting criticism from MPs. Frank Field, who chairs Parliament’s Work and Pensions Committee, has been especially vocal around the Carillion and BHS fiascos and the new plan is designed to make it a clearer, quicker and tougher regulator.
The success of automatic enrollment (and with the country’s smallest employers now on board) will make the Regulator’s job even harder and so it is important that it is seen to be tough and more vocal. This new approach should ensure that pensions are safer although despite the recent pension scandals it still does not have the power to punish firms with large pension deficits from paying its shareholders with big rewards. Perhaps this will be covered by the Department for Work and Pensions who said in March that it would be a criminal offence for bosses to commit ‘willful or grossly reckless behavior’ with a company’s pension scheme. Whichever department this falls under – it is a gap that urgently needs plugging.
TPR has also pledged to launch a new anti-scams campaign to help savers fight cyber-crime and work with trustees to improve scheme governance. Priorities for the next three years also include understanding and responding to the implications of Brexit, the effective regulation of master trusts and effective regulation of Defined Benefit (DB) schemes.
Overall, Broadstone see the new measures as very welcome, especially the quicker and tougher message which is already apparent in recent situations as the Regulator has been much more responsive and robust. Protecting member benefits while reducing negative impact on sustainable growth of sponsoring businesses can be a very difficult balancing act – particularly when one considers that even despite the new funds, the Regulator is working with quite a small budget.
The full plan is available at www.thepensionsregulator.gov.uk/docs/corporate-plan-2018-2021.pdf