DC pension code stresses TPR’s expectations of trustees

The Pensions Regulator’s new code of practice for defined contribution (DC) pension schemes, which sets out the standards that pension trustees need to meet to comply with legislation, has come into force with effect 28 July

The code, which applies to all schemes offering money purchase benefits, is supported by a series of 'how to' guides that provide more detail on how trustees can meet those standards in practice.

TPR has also produced a tool to help trustees to assess their scheme against the standards in the code, so that they can identify areas requiring improvement.

The trustees section focuses on the importance of oversight and governance of trustees, from appointing the right people to be trustees as they are critical players in the oversight of the pension scheme and exert a strong influence over how an occupational pension scheme is governed and how effectively member interests are protected.

The new code also stresses the importance of the role of the chair as well as the composition and organisation of the trustee board, including the format for meetings and related processes, as well as input from advisers and service providers to advice the trustee board.

Executive director for regulatory policy Andrew Warwick-Thompson said: ‘The new DC code clearly sets out our expectations of trustees and what is required of them to comply with legislation, including the most recent changes in law.

‘In revising the code, we have responded to calls from the pensions industry to shorten and simplify it, with an increased focus on legislative requirements. It is also being published in a dynamic and user-friendly way, including for people using tablets and mobile devices, offering the ability to navigate directly from the code to relevant legislation and companion guidance online.’

An updated compliance and enforcement policy for occupational DC schemes has also been published. It describes TPR’s expectations for compliance with legislation and how it will proceed to enforce the law.

Warwick-Thompson added: ‘We will act where trustees demonstrate that they are not meeting even the basic 'hygiene' duties of preparing their chair’s statement or completing a scheme return, as this is often an indicator of more serious stewardship failings.’

The The Pension Regulator code of practice for defined contribution (DC) pension schemes is available here

The code is set out in six sections, with a 'how to' guide supporting each section, details available here

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