Despite charging almost £200,000 for collecting levies, the Pensions Regulator has so far only managed to retrieve 83% of its mandate.
In its annual report figures from the Regulator shows it charged £190,000 to collect levies for both the Department for Work and Pensions, and the Pension Protection Fund (PPF).
However, although it was expected to collect a total of £186.3m, it succeeded in retrieving just £155m, equivalent to about 83% of the total amount invoiced.
Despite this, over its first 12 months of operation the regulator made a profit of almost £2.6 which was transferred into its general reserve, however when the regulator took over from the Occupational Pensions Regulatory Authority (OPRA), it also shouldered its debts, including a general reserve deficit of almost £5m.
This means despite making over £2m profit in its first year, the regulator still has a general reserve deficit of £2.5m, but although the organisation has been working from a deficit of almost £5m, over the last year pensions for the chief executive and chairman of the organisation have increased by £22-33,000.
As members of the civil service pension scheme, which as a public sector pension is not covered by the regulator because it is classed as a government body, senior members of the board saw large pension increases despite the organisation only halving its deficit.
The chief executive Tony Hobman, received an increase in the cash equivalent transfer value (Cetv) of his pension of £22,000, to total £96,000, while David Norgrove, the chairman of the regulator, increased the Cetv of his pension by £33,000 over the last year, to bring it to a current total of £589,000.
The report also highlighted the amount of work done by the regulator over the past year, including the setting up of the trustee toolkit online learning programme and initiating a clearance process for businesses involved in corporate transactions.
Over the last 12 months, the regulator reports it received 1,112 clearance enquiries and exploratory cases, and 330 full applications. Of these, so far 148 have been approved and just 2 have been refused.
So far the total fund value of schemes receiving clearance is around £22.9bn, with related deficits, calculated under the financial reporting standards 17 (FRS17) method, of £5.6bn, which is between 4-6% of the total market FRS17 deficit.
In addition the regulator reveals it received 391 notifiable events and received 43,000 calls to its customer support centre. It also appointed 54 trustees to its approved register and had to appoint 75 independent trustees to schemes with a total value of £1bn.
Hobman says: “A year of intense transition has given the regulator a strong platform on which to build for the future, and we have consulted extensively with our colleagues in the regulated community on all aspects of our work from scheme funding to codes of practice.”
He says the regulator fully recognises the front line role trustees play in the protection of members benefits and raising the standards of governance , particularly in smaller schemes, remains an important focus for the coming year.
Hobman adds: “We know much more needs to be done in the coming year but we welcome the prospect of reinforcing a risk-based yet flexible approach to the regulation of occupational pensions.”
Meanwhile, Norgrove points out: “Overall, our assessment of progress is: so far so good. The more gloomy predictions by some commentators have not come to pass and progress is being made to tackle issues surrounding work-based pensions.”
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
Equates to seven million people
Beware ‘sting in the tail’
Still 66% women in lower quartile
Led by Aberdeen Standard Investments
Introducing admin fee