Regulator orders pensions trustees to check data
16 Oct 2019
The trustees of hundreds of pension schemes are to be ordered to urgently review the data they hold as part of a crackdown on poor record-keeping by The Pensions Regulator (TPR), which could result in fines of up to £50,000 for those found to be non-compliant
16 Oct 2019
TPR is asking the trustee boards of 400 schemes to conduct a data review within six months. These schemes are believed to have failed to review their data in the last three years, and include defined contribution, defined benefit and public service schemes.
The trustees will be required to report to TPR what proportion of their members they hold accurate common and scheme-specific data for. Those that fail to do so may face action, which could include an improvement notice about their inadequate internal controls. Failure to comply with the notice carries a fine of up to £5,000 for an individual or up to £50,000 in any other case.
Analysis of scheme return data provided to TPR suggests that almost a quarter of schemes have not measured the quality of either the common or scheme specific data they hold in the last three years.
A total of 1,200 schemes are being contacted to remind them to carry out data reviews of both common and scheme-specific data every year. Trustees and scheme managers are responsible for ensuring these reviews are completed.
The move comes as TPR seeks to tighten its regulatory grip in a bid to drive up standards of governance and administration. In addition to record-keeping, communications will be sent to more than 1,000 schemes this year about issues such as dividend payments to shareholders and the length of recovery plans.
David Fairs, TPR’s executive director of regulatory policy, analysis and advice, said: ‘Accurate record-keeping is vital to good governance and administration – without it trustees cannot ensure that savers will get accurate information or receive the pensions they are entitled to.
‘Requiring trustees to carry out reviews will force them to look closely at their data and administration and take appropriate action to bring their systems up to scratch.’
TPR also points out that accurate record-keeping will be vital for the proposed ‘pensions dashboards’, which will allow savers to see all the information about their pension savings in one online account. An industry-wide framework for dashboards was given the green light in this week’s Queen’s Speech.
Trustees that discover that the data they hold is of poor quality will be expected to draw up improvement plans to rectify the problem.
By Pat Sweet