The Pensions Regulator has dismissed questions over whether its objectives need to be simplified in light of the collapse of Carillion.

Giving evidence to the Work and Pensions and Business, Energy and Industry Strategy committees on its role in the now defunct Carillion defined benefit pension scheme, TPR chief executive Lesley Titcomb said simplifying the regulator’s objectives is “not at the top of my list of priorities”.

According to Titcomb, the regulator’s three “statutory objectives” include DB funding to protect scheme members, reducing the risk to the Pension Protection Fund, while minimising impact upon sustainable growth of employers.

Titcomb said: “We have six objectives at the minute, four relevant in this case. We have to work with what we’ve got and any change would require legislation which would take time. It’s not top of my list of priorities.

“The way DB works is that we would always have to take into account the ability of the employer to support the scheme in the longer tern, that will always be a factor.

“To have regulator that doesn’t take that into account means we would be setting recovery plans that would seriously impact on the survival of the company, which in itself is not good for the scheme.”

Furthermore, the regulator said it would consider pursuing individuals over the failure of Carillion, and emphasised that it had issued a number of warnings as it increased the use of its powers over the last two years.

“If we are to increase our credibility you have to start with the examples that are there, and equally I don’t think we can afford to let people who have commit offences off the book”, added Titcomb.

In January, Carillion trustee chair Robin Ellison said in his evidence to the committees that the regulator's statutory objectives are conflicting, and that the framework it operates in is too restrictive.

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.”

Outlining where she thinks the regulator can improve, Titcomb said: “Improvement to the fund regime, ensuring they are adequately resourced and an improved approach to regulation.”

On giving the regulator increased powers, she confirmed they are working with DWP to implement fines for schemes failing to meet obligations.

The news comes in light of a prickly exchange between the regulator and committee in which the former was lambasted for not knowing exactly how many of the 6,000 DB schemes were close to failure.

TPR only opened an anti-avoidance investigation into Carillion on 18 January 2018, three-days after the out-sourcing firm filed for insolvency.


Commenting on three and a half hours of oral evidence in parliament this morning from The Pension Regulator and Carillion’s internal and external auditors, Deloitte and KPMG, Work and Pensions Committee chair Frank Field said: “We imagined that regulators regulate, and auditors audit. I suppose the employees, suppliers and pensioners of Carillion, and the public, did likewise. We were told this morning, however, that these highly paid individuals are mere spectators – commentators at best, certainly not referees - at the mercy of reckless and self-interested directors.

“I fear it is not only Carillion that is built on sand: it is our whole system of corporate accountability.”

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