PLSA AC 2020: No spike in missed employer AE contributions, says Counsell

There has not been a “significant or unusual spike” in missed pension contributions for automatic enrolment schemes, according to The Pensions Regulator (TPR) chief executive, Charles Counsell.

Speaking at the PLSA Annual Conference 2020 about the measures that the regulator had introduced in response to the Covid-19 pandemic, he stated that “the vast majority of employers” have continued to meet their duties as they had been before coronavirus emerged.

Counsell added that the regulator had also not seen a rise in employers avoiding their defined benefit responsibilities, with around 200 schemes, or 3 to 4 per cent, seeking a delay to deficit repair contributions (DRCs).

This is far below the 10 to 15 per cent that TPR had originally estimated would seek delays, while the vast majority of the requests received were deemed to be appropriate.

TPR had given automatic enrolment schemes an extra 60 days with which to report payment failures and included the option for employers to suspend or reduce DRCs for defined benefit schemes where employers were in difficulties because of Covid-19, though these payments must be caught up with later.

Counsell said: “I really do appreciate that it is quite early days and that economic fallout from Covid is likely to put further financial pressure on schemes, employers and individuals. We recognise that what is happening with Covid remains very uncertain and so we are vigilant, and will monitor the situation closely and respond accordingly.”

Counsell’s speech came on the same day that TPR launched a new 15-year corporate strategy.

He commented: “It has been quite an extraordinary six months that we’ve all faced as individuals, as an industry, as employers and as a nation. All of us are going through what is a deeply unsettling experience. We have had our working and our personal lives turned upside down and some of us will also have suffered painful losses.

“We don’t yet know what the full impact of Covid-19 will be but we do know that it will be profound and long-lasting. We also must expect that we are facing a difficult year ahead. I say a difficult year, but it may be at least a year. In this economic storm caused by the pandemic and all the uncertainty that comes with it, the security that we provide for workplace pension savers is more important than ever.”

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