The Pensions Regulator (tPR) is again consulting on how to improve record-keeping standards in pension schemes.
Although tPR finalised its good practice guidance only in January 2009, it now intends to adopt a “tougher approach” because, among other things, its research revealed “no evidence of marked improvement in administration practices since the guidance was issued”.
In particular, tPR is considering strengthening its regulatory approach. For example:
- any contact with tPR (eg through a whistleblower report, scheme return query, scheme specific funding plans) could result in it asking the scheme to demonstrate compliance with the record keeping guidance;
- tPR may select a sample of schemes, based on pre-defined risk criteria, to undertake tests and report the results to tPR.
TPR warns that evidence of poor record-keeping (or failure to comply with an information request) could lead to tPR taking enforcement action. For example, it may direct parties to carry out certain tasks (eg rectify gaps or errors in members’ records), issue civil penalties or, in extreme cases, prohibit trustees and/or appoint new trustees. Enforcement action may also be made public.
The consultation closes on 27 April 2010.
TPR will again update the industry on this issue at the end of 2010 and will consider whether its approach needs further modification in the run-up to 2012 (ie, the arrival of the automatic enrolment regime).