The Pensions Regulator (TPR) has issued new guidance aimed at simplifying and clarifying the process for third parties who wish to make applications requesting TPR to use its powers, such as the power to appoint an independent trustee.
TPR has a range of powers designed to oversee and enforce compliance within the pensions industry, and third-party applications can be made to request the Regulator to use these powers in specific circumstances. Generally, determining which parties can submit an application will depend on which use of power has been requested, but may include trustees, scheme managers, sponsoring employers or administrators. The exercise of these powers can be especially useful for historic schemes where, for one reason or another, the trustee cannot be contacted or (in the case of an employer who also acts as trustee) no longer exists. However, difficulties are often faced when there is an absence of scheme documentation or evidence to support an application.
Key points of the new guidance
The full range of powers that TPR can exercise in relation to a scheme are found in s10(6) of the Pensions Act 2004, however specific examples of the powers that TPR can exercise are:
- Appointing an independent trustee to a scheme;
- Extending a deadline for a cash equivalent transfer (CETV extension);
- Revoking a prohibition order prohibiting a person from acting as a trustee to a specific scheme, a particular description of schemes, or schemes in general;
- Revoking a suspension order preventing a person from acting as a trustee for a specific period of time; or
- Waiving an automatic disqualification of a person from being a trustee.
Eligibility Criteria
The guidance specifies who can make a third-party application. Typically, this includes parties such as trustees, employers, and pension scheme members who have a legitimate interest or concern regarding the operation of a pension scheme.
Application Procedure
The guidance provides a detailed outline of the steps required to make an application. This includes:
- Initial contact: ensuring that the applicant contacts TPR early to discuss the issue, potentially resolving concerns without formal intervention.
- Submission requirements: clear documentation and evidence must be provided to support the application, demonstrating the necessity for TPR to use its powers.
- Formal application: detailed instructions on how to submit a formal application, including the forms and formats to be used.
Considerations and Outcomes
The guidance also explains the factors that TPR will consider when reviewing an application, such as:
- Impact on the pension scheme: evaluating how the intervention might affect the scheme’s stability and members’ benefits.
- Legal and compliance issues: ensuring that the application aligns with legal standards and regulatory requirements.
- Evidence provided: assessing the robustness of the evidence submitted in support of the application.
After reviewing an application, TPR may decide to take action, request further information, or decline the application if it does not meet the necessary criteria.
By providing clear instructions and criteria, TPR aims to facilitate more streamlined and justified interventions, ultimately protecting the interests of pension scheme members and ensuring the integrity of pension schemes.
If you would like to discuss anything raised in this blog in more detail, or for support in making an application to the Pensions Regulator, please get in touch with a member of the pensions team or your usual Brodies contact.
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