The Pensions Regulator has exercised its powers under Section 7 of the Pensions Act 1995 to appoint three independent trustees to the Telent Pension Scheme. The power was exercised after the existing trustees approached the Regulator for assistance.

Section 7 permits the Regulator to make an appointment where it is necessary to “secure” that the trustees as a whole have or exercise the necessary skill or knowledge for the schemes proper administration; to secure the appropriate number of trustees; or to “secure the proper use or application of the assets of the scheme”.

The power has generally been exercised to appoint trustees when there are governance issues in a scheme's operation, or, for some reason, there are no trustees and no other way of appointing than by application to the Courts.

This is the first instance where the power has been exercised after an application by trustees in a takeover situation involving the sponsoring employer.

Appointments under Section 7 override the scheme rules and, to the extent needed, the Member Nominated Trustee provisions elsewhere in legislation. The terms of the appointment under Section 7 will also contain provisions about the Regulator's powers to change the new trustees and their remuneration.