Earlier in 2024 the Pensions Regulator announced and consulted upon its approach to the new requirement for trustees of private sector direct benefit (DB) schemes to a submit a statement of strategy alongside their actuarial valuations setting out the long-term funding and investment strategy for their scheme in a new format, with information about the trustees' approach to managing associated risks.
For most schemes there will be no immediate rush to prepare these statements of strategy. They are required only for valuations with an effective date on or after 23 September 2024, and both the valuations and the statements are to be submitted using a new digital service that will not launch until the spring of 2025.
However, in response to widespread criticism that its initial requirements were overly complex, onerous and costly to complete, the Regulator has now announced changes that will, in many cases, scale back on the detail trustees must submit in the statement of strategy while also providing more opportunity for trustees to tailor their responses to the particular circumstances of their schemes.
In addition, to assist trustees in understanding and meeting their obligations, as an interim response to the consultation the Regulator has now published four illustrative templates along with a reference list that sets out all data that might be required.
The illustrative templates differ depending on whether a scheme adopts a Fast Track or Bespoke approach, and whether the scheme has reached "significant maturity" by the valuation date. Although the appearance of the final templates may change when it follows-up with a full response to the consultation "this winter", the Regulator has confirmed that the information and data required in them will not. Now, then, is a good time for trustees and their advisers to become familiar with their content.
If you would like to discuss anything raised in this blog in more detail, please get in touch with a member of the pensions team or your usual Brodies contact.
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