On 1 February 2010 the Pensions Act requirements in relation to trustee training came into effect. From that date every trustee of an occupational pension scheme (except a death benefit only scheme) must undertake trustee training. If you are an employer who operates an occupational pension scheme you must arrange for the trustees of that scheme (and the directors of a corporate trustee) to receive appropriate training. Failure to do so may leave you open to prosecution. If you are a trustee and you fail to undertake the appropriate training required by the Pensions Act you may be fined. The requirement for an employer to arrange trustee training does not apply to pensioneer or professional trustees. However, member trustees of small self administered schemes operated by an employer would need to have appropriate training arranged by the employer.

Trustee Responsibilities

In an environment of increasing regulation, litigation and poor investment performance, pension scheme governance is increasingly being focused on by the Pensions Ombudsman, the Pensions Board and scheme members. Pension scheme trustees have a central role in ensuring that pension schemes are properly administered and that members’ entitlements are protected. As a pension scheme trustee you will have duties and responsibilities under the scheme’s documentation, trust law, the Pensions Act and a variety of other legislation. In order to properly fulfil this role you need to be fully trained and competent in the requirements of the role. However, the majority of individuals appointed as trustees of a pension scheme are non-professional trustees and will have limited experience of the often complex world of pensions.

Trustee Training Requirements

Where you are appointed as a trustee prior to 1 February 2010 the training must be completed before 1 February 2012 and you must undertake further training at least every two years thereafter. If you are appointed after 1 February 2010 you will need to receive training within six months of appointment and you must undertake further training at least every two years thereafter. If you are a trustee of a number of schemes you still need to satisfy the training requirements, but not in relation to each scheme. Records of the relevant training will need to be kept and details included in the scheme’s annual report. The cost of the training may be paid out of the resources of the scheme. However, it is necessary to confirm that the scheme rules provide for this. The form of the training is not prescribed and there is no certification requirement as yet. It is possible to use the online training system made available by the Pensions Board to meet the requirements or to use the services of a trustee training or other service provider.

In addition to the Pensions Act, regulations made thereunder and the duties and responsibilities of trustees generally, you must receive training on laws applying to your scheme which will include:

  • the Family Law Acts;
  • Protection of Employees and other employment legislation; and
  • Financial legislation.

In addition to generic training, it would be advisable to seek training on the specific wording of your scheme’s provisions.

Trustee Handbook

The Pensions Board has recently published the third edition of its Trustee Handbook. The handbook is available to download online from the Pensions Board’s web site at Trustee Handbook free of charge. The Trustee Handbook provides up to date authoritative guidance for trustees on how to achieve compliance with the Pensions Act and other relevant legislation and good practice generally in relation to scheme administration. The new Handbook has been updated to include all legislative developments since the publication of the 2nd edition in 1998. The Handbook should be of particular importance to trustees as the Disclosure of Information Regulations contain a requirement that specific reference be made in the annual report of each scheme as to whether the trustees of the scheme have access to the Handbook.

Trustee Handbook (0.88 MB, Adobe PDF)