Louise Davey, Director of Regulatory Policy, Analysis and Advice at The Pensions Regulator explains why ignoring environmental, social and governance factors is no longer an option for trustees. Just a few years ago it would have been rare for pension trustees to consider climate, environmental, social and governance (ESG) factors and wider sustainability issues in significant detail. That has changed — driven by developments in government policy, increased regulations, industry initiatives and greater awareness of the potentially profound implications for life as we know it if action is not ..read more

As widely reported in the media, the UK economy has been through significant turbulence recently. Increasing inflation, interest rates and fuel / energy prices have impacted both businesses and the public alike. In addition, according to the Bank of England’s monthly ‘Money and Credit’ statistics, the level of debt taken on by UK businesses has increased during the pandemic which has reduced resilience and there has been an increase in borrowing by small and medium-sized enterprises. A high level of debt among businesses can risk their ability to support defined benefit (DB) pension schemes ..read more

Much has happened since I became Chief Executive of The Pensions Regulator (TPR) back in 2019, not least the inexorable march towards a new pensions reality in which savers bear far more risk and responsibility for their retirement choices. That’s why I have made clear from the outset that TPR – working hand in hand with our partners – has a crucial role to play in ensuring those who run pensions help deliver the best possible outcomes for savers. I stand by that commitment. We are putting savers at the centre of our thinking and examining everything we do through the saver’s lens, and I am c ..read more

When someone buys a car, all sorts of different factors might influence which one they plump for. How fast it is. Its eco credentials. Even the boot size. People weigh up the pros and the cons to try and get the best value for them. What’s more, they can take a test drive to see if the ride lives up to expectations. If not, they can move on and find another runner. Workplace pensions aren’t like that. Most people haven’t made an active buying decision based on performance factors. And the actual value for money a scheme provides isn’t clear to the saver until it’s too late to do anything abou ..read more

Like others, we welcomed news that the trustees of the two Arcadia Group pension schemes have agreed a buy-in with Aviva, securing benefits for 8,800 members of the schemes. As part of the £850m deal, members of the main Arcadia Group Pension Scheme will be provided with the full benefits they would have been entitled to if Arcadia had not become insolvent. This is of course a positive result for those who not only lost their jobs when the Arcadia group collapsed into administration in 2020, but also faced uncertainty about their pensions. But the deal is also a strong reminder of what can be ..read more

Exactly a year ago, I blogged that the underpinning principle of our revised defined benefit (DB) Funding Code was that schemes should have the necessary long-term funding approach to ensure savers have the best chance of receiving the benefits they expect. The need for long term funding is also a key government objective and underpins the regulations published by DWP. These have given us the clarity we need to publish our second consultation on the draft DB Funding Code, which explains how we will interpret the legislation and will help trustees meet the rules set out by government. I’m deli ..read more

The days of savers being left in small defined contribution schemes offering some benefits but little value are over, says David Fairs, TPR’s Executive Director of Policy, Analysis and Advice. Instead, it’s time for trustees to take advantage of available support and guidance to increase their skills in relation to investment decisions and take action to enable pension savers to access the investment opportunities that best support good outcomes — whether in their existing scheme or through consolidation. We welcome the publication of a suite of guides by the Productive Finance Working Group ..read more

TPR issues update to joint regulatory strategy. I’m going to let you in on a not very well-kept secret… while we as regulators appreciate the reasons for our different frameworks, pension savers don’t care who regulates them. They just want to know that when they save: a) their money is secure and b) that they get value for every penny invested. Those principles have guided our work with the Financial Conduct Authority (FCA) over the four years since the publication of our joint regulatory strategy. Four years in which we have seen savers increase their retirement savings (up 30% in assets pe ..read more

Our Equality, Diversity and Inclusion (EDI) Strategy sets out an ambitious roadmap for change. The strategy outlines the steps we are now taking to move towards a fairer and more inclusive culture across the pensions industry. We have pledged to lead by example and embed diversity and inclusion throughout our own organisation and support our regulated community to do the same. As the UK regulator of workplace pensions and as an employer, we have been on this journey for some time, but we know there is much more to do. Crucial to bringing about lasting change is measuring our progress and ensu ..read more

Last month marked 10 years since the start of automatic enrolment (AE). In that time, AE has changed hearts and minds about pensions. Providing a workplace pension is now no longer confined to a minority of employers and staff across all employment sectors now expect a pension as part and parcel of their job. At The Pensions Regulator, we are all extremely proud of our contribution to the success of the roll-out and the huge impact AE has had on the savings landscape. The deep-rooted social change brought about by AE is not only our success. Introduced by government in 2012 to tackle falling ..read more