Last year, the Regulator formally launched a governance framework for occupational DC pension schemes, by putting in place a code of practice and guidance in relation to the governance and administration of such schemes.
The Regulator has said that it expects trustees of such schemes to publish an annual governance statement to demonstrate that their scheme satisfies the code of practice, guidance and in particular that it exhibits the quality features set out in those documents (and if not, to explain why) and that this should be easily available to employers and scheme members e.g. by putting it on a web-site or including it in the scheme's report and accounts. The Regulator has also published a template to help trustees to assess their schemes against the quality features and to complete the governance statement.
As we mentioned in the article referred to above, the completion and publication of the governance statement, whilst perhaps a helpful tool for trustees in assessing how well their schemes are being run, is not a legal requirement and is likely to add additional costs for DC occupational pension schemes (which are possibly unnecessary for schemes which already have effective systems in place for monitoring and ensuring good governance). However, the absence of such a statement may also attract costly and time consuming scrutiny from the Regulator.