The watchdog plans to get more involved with struggling DB schemes, drive up the quality of administration and improve standards of trusteeship
Standards of trusteeship will be under increased scrutiny from the Pensions Regulator, according to the watchdog’s 2017-2020 corporate plan.
The document outlines eight priorities for the three-year period. These include making faster, more frequent interventions into troubled defined benefit schemes; improving standards of record-keeping and administration, as well as focusing on better quality trusteeship from professional trustees and trustee chairs in particular.
It will also continue with its remit to complete the implementation of auto-enrolment, regulate master trusts and liaise with schemes and employers.
“Targeted and tailored” communications for different trustee groups setting out examples of good and bad practice feature in the plan, as does the promise of tools that trustees can use to meet required standards.
This should bring us some quick wins across overall standards of trusteeship
The regulator’s initial focus will be on professional trustees. “As experts, they are held to a higher duty of care than other trustees,” it says. “By ensuring they are the right people to perform this service and are behaving to this higher standard, this should bring us some quick wins across overall standards of trusteeship.”
Scheme consolidation is also clearly in the regulator’s sights. “We believe there is a good case for consolidation where standards are not being met. We will continue to work with industry and the DWP, looking for opportunities to encourage consolidation, and identifying legislation or practices which may be inhibiting it.”
Scams and data security risk remain firmly on our agenda
Data also remains a key focus, and specifically the increasing risks associated with data security. The report says: “Scams and data security risk remain firmly on our agenda, not least as the way people save and access their pensions continues to change.” Quality of record-keeping “remains unsatisfactory, continuing a long-running risk to member benefits and the accuracy of benefit statements, scheme returns and valuations,” and TPR also points to the security threats of member data held on third-party IT systems.
Overall, it promises “focused, faster and more frequent” interventions. Chief executive Lesley Titcomb said the priorities “show how we are evolving to become a bolder, more effective regulator.” TPR recently secured its first criminal convictions, further demonstrating its readiness to take action over poor practice.
In order to bolster its front-line activities and to ensure it is capable of effectively policing master trusts, TPR has also redefined its budget which, with the approval of the DWP, now includes an additional £3.5m for 2017-18, compared to its original budget