The Pensions Regulator has published two initiatives outlining how it plans to address the risks to members from defined contribution (DC) schemes.
It has released the latest instalment in its Trustee Toolkit: “How a DC Scheme Works” alongside a 56-page consultation paper on how the Regulator plans to regulate DC schemes.
The new module of the Trustee Toolkit, the Regulator’s free online learning programme for trustees, is specifically aimed at DC scheme trustees and includes information on contributions, the tax regime and investment choices, and the administration of the scheme.
Meanwhile the consultation, which closes on 2 February 2007, outlines the regulators approach to DC schemes which focuses on three areas:
- Improving education and guidance: through existing codes of conduct, and e-learning programme and the publication of “Good Practice Guidance”.
- Partnership working: where it plans to build on existing strong relationships with other regulatory bodies and the pensions industry, to ensure the proposals can be implemented consistently and to make sure “a coherent and holistic view” is taken in respect of new risks and mitigating activities.
- Intervention: where there are persistent or significant failures which result in poorly managed schemes or which put members’ benefits at risk, the Regulator says it plans to act decisively, including publicly reporting or “naming and shaming” advisers and service providers to both the industry and professional bodies and organisations.
Tony Hobman, chief executive of the Pensions Regulator, says: “This consultation document puts flesh on the commitment in our medium term strategy to tackle the specific risks to DC schemes. We very much welcome input from all parties with an interest in work-based DC schemes to enable us to give the right focus to these schemes.”
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Nyree Stewart on 020 7968 4558 or email [email protected]IFAonline
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