The Pensions Regulator’s Nicola Parish looks at recent high-profile cases and what the regulator will do differently in future.
The last few weeks have been a clear demonstration of the successes the regulator has had so far – and about our commitment to act more swiftly and decisively from now on.
We will use our powers to protect savers, but we are prepared to be flexible in our approach and work with all parties to reach the right outcome
At the end of June we published the regulatory intervention reports into the Coats and BHS cases. Our action in those cases pushed the amount secured by the regulator for members of defined benefit schemes past the £1bn mark.
This is a significant landmark and one that we will continue to build on by intervening when necessary to protect the retirement benefits of members.
Our reports on these cases illustrate to employers and trustees that we will use our powers to protect savers, but that we are prepared to be flexible in our approach and work with all parties to reach the right outcome.
Our action against thread manufacturer Coats, for instance, has led to a very positive outcome for more than 30,000 members of its pension schemes.
More than £320m of funding has been put into the company’s pension schemes by Coats, which has also agreed to become the statutory employer for the schemes so that it will be responsible for supporting them from now on.
We maintained a strong working relationship with Coats and the trustees, allowing us to be flexible and achieve a fair resolution. The ongoing trading operations of Coats have now improved, bringing greater certainty that future benefits will be paid in full.
The BHS report, meanwhile, highlights the lessons we have learnt about how we can regulate more effectively.
The settlement agreement in this case provides funding for a new independent pension scheme to give future pensioners the option of the same starting pension as they were originally promised by the company, and higher benefits than they would get from the Pension Protection Fund.
The case was a long-running one, and we have recognised that there were some things we could have done better.
Programme for change
We are already acting more quickly to intervene where we consider schemes to be underfunded, or where there are indications that employers may be avoiding their responsibilities. As part of our TPR Future programme, we are reviewing internal processes and ways of working to be more efficient, more outcome-focused and communicate clearly to schemes what we expect from them.
In addition, we are recruiting staff to increase our proactive casework, to ensure early engagement with schemes and to progress investigations more efficiently.
BHS grabbed the headlines for a raft of reasons, including the large sums of money being discussed, the personalities involved and the company’s place on the high street.
But it is just one of many cases in which our actions are having a real impact, helping provide pension scheme members a more secure financial future.
Nicola Parish is executive director of frontline regulation at the Pensions Regulator
