There have been calls to increase the powers of The Pensions Regulator (TPR), as MPs hint the defined benefit white paper could be with us by spring.
Giving evidence to the Liaison Committee on the cross government response to the collapse of Carillion, MP for Aylesbury David Lidington said that the government’s proposals will arrive “sooner rather than later” and did not rule out enhancing the powers of the Regulator.
Lidington was responding to a question from Business, Energy and Industrial Strategy Committee chair Rachel Reeves, who suggested that TPR should be able to issue higher levels of fines if companies are consistently failing to close pension deficits.
Lidington said: “TPR already have significant powers if they have evidence to show that there has been a breach of legal duty by the trustees of a pension fund, or directors of a company.
“The Prime Minister has already said that the government will be publishing proposals later this year—I think it will be sooner rather than later this year, this spring—to strengthen further the powers available to TPR.”
TPR have come under increasing scrutiny in the wake of the Carillion scandal, particularly when it emerged that it knew about the outsourcing firm’s funding plight since 2008.
Work and Pensions Committee chair Frank Field said that TPR had “questions to answer” over its failure to use its powers in the Carillion scandal, despite trustees raising numerous concerns.
Field also said that TPR’s recent investigation into Carillion to determine whether it should use its anti-avoidance powers against the firm “does not cut the mustard”.
Speaking to the Business, Energy and Industrial Strategy and Work and Pensions committee MPs, Carillion Defined Benefit Pension Trustee Limited chair, Robin Ellison the current way TPR operates could give “false comfort” to the system.
Ellison said: “We might explore whether the existence of the regulator and the way the regulator operates gives some kind of false comfort to the system and that people rely on it, when they can’t.
“I wonder if any regulator, even if it was beefed up to the nth degree, could do the job that it is being asked to do, and because of its role, people are putting trust in it that it can’t deliver on.”
TPR said that calls for new powers is a matter for government and it awaits the White Paper in due course.