On the go: Pension trustees at Northern Irish high street retailer Dunnes Stores have been stopped by the Pensions Regulator from running the company’s defined contribution scheme.
Employer-nominated trustees of the scheme failed to engage properly with the regulator and persistently failed to address a catalogue of governance concerns raised by the watchdog, despite assurances that they would.
To protect savers, the regulator has appointed an independent trustee, Dalriada Trustees, to oversee the £12.8m Dunnes Stores (Bangor) Limited Management Pension Scheme. The acting trustees were found to lack the knowledge and understanding to govern the plan properly.
The decision was made by TPR’s Determinations Panel because it was concerned that the trustees’ failure to grasp their responsibilities was putting the benefits of 390 DC scheme members at risk.
This is the first time the watchdog has used its power to appoint a trustee primarily because of a lack of competence of the existing trustee board.
Nicola Parish, TPR’s executive director of frontline regulation, said: “We will not stand by when trustee incompetence threatens the retirement outcomes of workplace pension savers.
“In this case, the trustees put member outcomes at risk, and so we took action to ensure benefits are protected. The trustees have been replaced because they have consistently failed to show they had the skill to do the job properly.”
After an investigation by the TPR's case team into a series of governance issues, the case was referred to the Determinations Panel.
The panel found that, despite more than a decade of being responsible for running the scheme, the employer-nominated trustees had failed to “familiarise themselves with the requirements of UK pensions legislation”.
The trustees showed “that they do not have, or are not exercising, their knowledge and understanding for the proper administration of the scheme”, which led to a series of governance errors with little attempt to rectify them, according to the panel.
Dalriada Trustees is now in the process of considering the future of the scheme as to the best way to protect member benefits.
Members will be kept informed on the future of the scheme.
