7 days

7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.

In this 7 Days

• House of Commons Library publishes briefing papers
• PPF publishes updated guidance for restructuring and insolvency professionals
• Retirement Quality Mark – consultation response
• TPR issues maximum chair’s statement fine for professional trustees

House of Commons Library publishes briefing papers

On 15 August 2016, the House of Commons Library published a briefing paper looking at the DWP’s consultation in March 2015 on the application of the “section 75 employer debt provisions” to multi-employer pension schemes. An Early Day Motion has recently called on the Government to respond to the consultation which remains outstanding.

On the same date, the Library updated its briefing paper considering the impact of increases in the State Pension age for women born in the 1950s.

PPF publishes updated guidance for restructuring and insolvency professionals

On 16 August 2016, the PPF republished its General Guidance for Restructuring and Insolvency Professionals.

This guide provides information on how insolvency practitioners and official receivers should interact with the PPF in the event that a sponsoring employer of an eligible occupational pension scheme suffers an insolvency event. The document updates guidance published in January 2016, and sets out criteria restructuring practitioners should incorporate in any proposals they make in respect of the insolvent employer.

At the same time, it published a factsheet – Restructuring and Insolvency – The PPF Approach – which aims to explain why the PPF enters into restructuring and rescue agreements, and to summarise the principles it uses to make its decisions.

Retirement Quality Mark – consultation response

On 16 August 2016, the Pension Quality Mark (“PQM”) Board published an overview of responses to its November 2015 consultation on developing a Retirement Quality Mark (“RQM”). The original consultation sought views on the role of a RQM and the standards it might use, and the report summarises responses to these governance and communication standards.

The report states that the responses “show widespread support for the role a RQM could play in helping savers secure a good retirement income and trustees to support pension scheme members”.

For savers, there was agreement that a quality mark would:

• build on current guidance and act as an enabling tool to help consumers make informed decisions
• signal products that had met an independent quality standard in relation to governance and communications. 85% of consumers thought it was important for a good retirement product to be independently accredited by a third party
• help build confidence in pensions and retirement saving.

Respondents also felt that a quality mark would assist trustees in signposting scheme members to products that had been assessed as being “good”, based on the quality of their governance and communications.

The PQM Board hope to launch the new mark later this year. They note that, in the interim, they will carry out further discussions with pension schemes and providers interested in becoming RQM award holders, as well as the wider stakeholder community.

TPR issues maximum chair’s statement fine for professional trustees

On 17 August 2016, TPR issued a press release reminding trustees of DC schemes that they must comply with new pensions law, or face a mandatory fine.

The warning comes after a professional trustee firm was ordered to pay fines, having failed to meet the statutory requirement to prepare an annual governance statement, signed by the chair of trustees, for three separate schemes.

The maximum fine of £2,000 was imposed in respect of each scheme, because a professional trustee was in place and there were no mitigating factors. TPR has issued a regulatory intervention report about the case.

Nicola Parish, Executive Director for Frontline Regulation at TPR, said: “Professional trustees are expected to meet a higher standard of care and to demonstrate a greater level of knowledge and understanding than other trustees […] schemes should be aware that this type of breach will result in a fine and we hope that our report will act as a reminder to all trustees, professional or otherwise, to ensure they complete the chair’s statement on time.”