A new consultation on measures to boost protections for members of defined benefit (DB) pension schemes has been launched by DWP today
Under the proposals, DB schemes will be required to have long-term plans set out in a funding and investment strategy, with these plans also submitted to The Pensions Regulator (TPR).
The consultation follows the passage of last year’s landmark Pension Schemes Act, which set out the framework for the new regulations, as well as an engagement programme with stakeholders connected with a range of schemes.
Almost 10 million people across the country remain in DB schemes, with around one million of those still actively paying into one. Collectively, DB schemes manage a total of approximately £1.7 trillion worth of assets.
The proposed measures will contribute towards clearer funding standards and support trustees and employers to plan their scheme funding over the longer-term, embedding good practice already seen in the market, as well as requiring trustees to report progress against scheme targets.
Minister for Pensions Guy Opperman said:
The plans will also enable TPR to intervene more efficiently to protect members when needed – schemes will submit a statement of strategy alongside a scheme valuation. Where a scheme appears to be falling short of its legal requirements, the Regulator will be able to step in and engage with the scheme to ensure compliance and boost member security.
Charles Counsell, Chief Executive of The Pensions Regulator said:
The DWP consultation also seeks input on additional proposals which would require DB schemes to appoint a Chair, where they do not already have one.
The consultation will run for 12 weeks from 26th July 2022, with DWP particularly seeking feedback from trustees and managers of DB schemes, sponsoring employers, industry professionals, scheme members, and other stakeholders.
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