The Pensions Regulator has launched a consultation on defined benefit ("DB") regulation. The consultation, published on 2 December 2013, includes:
- a revised funding code of practice - providing updated practical guidance to trustees in relation to complying with scheme funding requirements. The code also includes a section on identifying, assessing and mitigating funding risks.
- a draft regulatory strategy - detailing the Regulator's strategic objectives, including its new statutory objective to minimise any adverse impact on the sustainable growth of an employer. The strategy specifically considers how the new statutory objective will operate alongside the Regulator's current objectives; and
- a revised funding policy - this sets out the Regulator's approach as to how DB funding should be regulated. Examples of acceptable approaches to funding and recovery plans are provided and these will be reviewed by the Regulator on an annual basis so that economic conditions can be factored into this assessment.
The consultation period will close on 7 February 2014 and it is expected that the new code will come into force by July 2014. The consultation papers can be accessed here.