UK - The Pensions Regulator (TPR) has updated the framework and guidance on Trustee Knowledge and Understanding (TKU) to include more focus on buyouts, personal accounts and administration.

The original TKU guidance was published in 2005, and the code of practice was issued in 2006, with an understanding to review both pieces of work in 2008, even though TPR claimed the guidance had been found to have "stood the test of time".

In the new guidance, TPR said it has taken into account changes in regulation, legislation, the market place and the focus of the regulator and, as a result, it has produced three sets of guidance aimed at different types of scheme.

TPR revealed following the UK government's recent deregulatory review it had decided to reconsider the scope guidance in relation to trustees of very small schemes, in particular occupational defined contribution schemes with between 12-99 members, which has resulted in the development of "much reduced scope guidance".

In addition, TPR has confirmed a full version of the guidance is aimed at defined benefit (DB) schemes with associated DC arrangements, while a shorter version is targeted at trustees of DC schemes with no DB element, while the shortest version is for trustees of the smallest schemes.

The regulator said the original guidance covered what trustees needed to know and understand and "those requirements have not changed and are very unlikely to", as the intention behind the code and guidance is to allow trustees to understand advice given by professional advisers and to reach their own decisions.

Minor changes outlined in the TKU consultation include:

The importance of good administration; Reference to the forthcoming Personal Accounts regime Developments in investments over recent years; The importance of the employer covenant and trustees' understanding of their powers; Buyout issues (including abandonment and inducements);

But despite the increased focus on certain areas of interest to TPR, to ensure the 'checklist' of topics remain relevant for trustees, the regulator claimed the changes would not involve the industry in "any extra commitments of time or cost".

Terry Clayworth, regulated community learning manager at TPR, said: "The refreshed code and scope guidance reflect changes in regulation, legislation, the market place and the focus of the regulator - while seeking to lighten the load wherever possible."

The consultation period will last for 12 weeks with any submissions on the details and focus of the guidance to be submitted to TPR by 31 December 2008.

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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