Workplace pension schemes will come under greater scrutiny from The Pensions Regulator (TPR) from October 2018, its new report says.
The change in approach is part of a broader movement by TPR to help protect savers and reflect major changes in the political, economic and pensions landscape.
TPR will be actively working with more pension schemes in an attempt to address risks sooner, clearly set out its expectations and take action when necessary.
There was a major internal review on the way TPR regulates pension schemes and this has resulted in a transformation in the way the organisation works to safeguard member benefits.
TPR chief executive, Lesley Titcomb commented: “Schemes across all sectors, whatever their size, can expect the volume and frequency of their interactions with us to increase so that potential risks to pension savers are identified early and put right before it becomes necessary for us to use the full force of our enforcement powers.”
The new approach is primarily aiming to introduce a supervision regime to monitor schemes more closely, and intervene at the required intensity depending on the severity of the risks identified.
TPR also plans to introduce one-to-one supervision for 25 of the biggest DC, DB and public service pension schemes from next month, and hopes that this will be rolled out to more than 60 pension schemes over the next year.
Higher volume supervisory approaches are being introduced to address risks and influence behaviours across a broader group of schemes. This will be initially trialled with around 50 DB schemes to assess compliance with TPR’s 2018 annual funding statement, specifically concerning whether schemes are being treated fairly when it comes to dividend payments to shareholders.
Titcomb concluded: “An important element of our new approach will be the use of a broader range of communication channels to drive behavioural change by promoting greater understanding of what schemes need to do in order to comply with the law and demonstrate high standards.”