The Regulator has received over 40 responses to its consultation document entitled How the Pensions Regulator will regulate defined contribution schemes in relation to risks to members, published in November 2006.
The responses identified some additional risks to members, not captured in the consultation document, for example, interaction with state benefits, low take up and inadequate levels of contributions. Some of the responses expressed concern that the regulatory proposals could increase the burden on employers and costs to schemes. It was highlighted that the Regulator should not be involved in setting benchmarks for scheme charges and should avoid becoming a price regulator - for example, by intervening where it believes scheme charges are too high. This would be outside its scope of authority.
In its consultation report, the Regulator stated that the responses did not call for a fundamental change to its approach. It has emphasised that:
- it was not looking to increase the burden on employers;
- its main focus was on providing guidance and encouraging good practice;
- it would continue working in partnership with industry representatives; and
- any regulatory intervention would only be considered as a last resort.