The Pensions Regulator (TPR) has issued a fine against a corporate trustee in the UK in a drive to ensure savers receive value from their pension schemes.
Regulation, which came into force in 2021, require trustees of pension schemes with less than £100m in assets to undertake a more detailed assessment of value for members than larger schemes.
Those failing to deliver value must set out a plan to improve or transfer members to a better-value scheme.
To ensure this, TPR launched an exercise to ensure compliance with rules over value for member assessments. According to the regulator this is already helping drive consolidation, with 16% of schemes from the pilot reporting that, having concluded their schemes do not offer good value, they have opted to wind them up.
Following the initial pilot, TPR will be scrutinising information from defined contribution scheme returns with the potential for fines to be issued for non-compliance.
The regulator already issued a fine of £12,500 against a corporate trustee and further fines will be issued shortly, it said.
Mel Charles, TPR’s interim director for frontline regulation, said: “Where trustees are found to be in breach of their duties on value, we’ll want to understand how they’ll improve. But, if they can’t or won’t, we expect them to transfer members to a better-value scheme and consider winding up their scheme.
“It is encouraging that our initiative has shown schemes are now actively choosing to wind up in the face of the new regulations.”
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